PLNJ CP2 (2014) 2019 Combined Document

ASU 2018-12 Amended Topic

Description

Method of adoption

Effect on the financial statements or other significant matters

Cash flow assumptions used to measure the liability for future policy benefits for non-participating traditional and limited-pay insurance products

Requires an entity to review, and if necessary, update the cash flow assumptions used to measure the liability for future policy benefits, for both changes in future assumptions and actual experience, at least annually using a retrospective update method with a cumulative catch-up adjustment recorded in a separate line item in the Statements of Operations.

An entity may choose one of two adoption methods for the liability for future policy benefits: (1) a modified retrospective transition method whereby the entity will apply the amendments to contracts in force as of the beginning of the earliest period presented on the basis of their existing carrying amounts, adjusted for the removal of any related amounts in AOCI or (2) a full retrospective transition method.

The options for method of adoption and the impacts of such methods are under assessment.

485BPOS 1 plnjcp2-14regtofile.htm PLNJ PRULIFE CUSTOM PREMIER II (2014) PLNJ CP2 (2014) 2019 Combined Document



As filed with the SEC on April 11, 2019 .	Registration No. 333‑112809
	Registration No. 811-03974

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-6

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

Post-Effective Amendment No. 37

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

Amendment No. 192

PRUCO LIFE OF NEW JERSEY

VARIABLE APPRECIABLE ACCOUNT

(Exact Name of Registrant)

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

(Name of Depositor)

213 Washington Street

Newark, New Jersey 07102

800 778-2255

(Address and telephone number of principal executive offices)

Christopher J. Madin

Vice President and Corporate Counsel

Pruco Life Insurance Company of New Jersey

280 Trumbull Street

Hartford, CT 06103

(Name and address of agent for service)



It is proposed that this filing will become effective (check appropriate space):

□	immediately upon filing pursuant to paragraph (b) of Rule 485
■	on May 1, 2019, pursuant to paragraph (b) of Rule 485
	(date)
□	60 days after filing pursuant to paragraph (a)(1) of Rule 485
□	on pursuant to paragraph (a)(1) of Rule 485
	(date)

■	This Post-Effective Amendment designates a new effective date for a previously filed Post-Effective Amendment.

PART A:

INFORMATION REQUIRED IN THE PROSPECTUS

PROSPECTUS

May 1, 2019

PruLife® Custom Premier II (for Contracts issued on or after September 5, 2014*)

AN INDIVIDUAL FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE INSURANCE CONTRACT ISSUED BY:

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

213 WASHINGTON STREET

NEWARK, NEW JERSEY 07102

TELEPHONE: (800) 944-8786

*The PruLife® Custom Premier II Contract (2014) is offered on or after September 5, 2014, under form number VUL-2014. A state and/or other code may follow the form number. Your Contract's form number is located in the lower-left hand corner of the first page of your Contract.

As of May 1, 2015, Pruco Life of New Jersey no longer offered these Contracts for sale.

This prospectus describes the PruLife® Custom Premier II Contract (2014) (the “Contract”) offered by Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey", "us", "we", or "our"), a stock life insurance company. Pruco Life of New Jersey is an indirect, wholly-owned subsidiary of The Prudential Insurance Company of America ("Prudential"). 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 or prospective clients. The information is not intended as investment advice and is not a recommendation about managing or investing finances in a variable insurance product. Clients seeking information regarding their particular investment needs should contact a financial professional.

Please read this prospectus before purchasing a PruLife® Custom Premier II (2014) Contract and keep it for future reference. Capitalized terms used in this prospectus are defined where first used or in the section DEFINITIONS OF SPECIAL TERMS USED IN THIS PROSPECTUS.

You (the "Contract Owner") may choose to invest your Contract's premiums and its earnings in one or more of the available Variable Investment Options of the Pruco Life of New Jersey Variable Appreciable Account (the "Separate Account" or “Account”). The Account offers a wide variety of Variable Investment Options from the firms listed below. A complete list of the available Funds is included in this prospectus.



•	Advanced Series Trust	•	Hartford
•	American Century Investments®	•	Janus Henderson
•	American Funds®	•	MFS®
•	Dreyfus	•	Neuberger Berman
•	Fidelity® Investments	•	Prudential
•	Franklin Templeton®	•	TOPS – The Optimized Portfolio System®

You may also choose to invest your Contract’s premiums and its earnings in the Fixed Rate Option, referred to as the "fixed investment option" in your Contract, which pays a guaranteed interest rate.

IMPORTANT INFORMATION

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission ("SEC"), paper copies of the Funds' annual and semi-annual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on our website (www. prudential.com/eprospectus), 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 the Funds electronically anytime by going to www.prudential.com/edelivery. You may elect to receive all future reports in paper free of charge by calling 877-778-5008.

In compliance with U.S. law, Pruco Life of New Jersey delivers this prospectus to Contract Owners that currently reside outside of the United States. In addition, we may not market or offer benefits, features, or enhancements to prospective or current Contract Owners while outside of the United States.

Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined that this Contract is a good investment, nor has the SEC determined that this prospectus is complete or accurate. It is a criminal offense to state otherwise.

The Contract may be purchased through registered representatives located in banks and other financial institutions. Investment in a variable life insurance contract is subject to risk, including the possible loss of your money. An investment in PruLife® Custom Premier II is not a bank deposit and is not insured by the Federal Deposit Insurance Corporation (“FDIC”) or any other governmental agency.

TABLE OF CONTENTS



	Page
SUMMARY OF CHARGES AND EXPENSES	1
SUMMARY OF THE CONTRACT AND CONTRACT BENEFITS	3
SUMMARY OF CONTRACT RISKS	5
SUMMARY OF RISKS ASSOCIATED WITH THE VARIABLE INVESTMENT OPTIONS	7
GENERAL DESCRIPTIONS OF PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY, THE REGISTRANT, AND THE FUNDS	8
CHARGES AND EXPENSES	14
PERSONS HAVING RIGHTS UNDER THE CONTRACT	19
OTHER GENERAL CONTRACT PROVISIONS	19
RIDERS	20
REQUIREMENTS FOR ISSUANCE OF A CONTRACT	25
PREMIUMS	25
DEATH BENEFITS	29
CONTRACT VALUES	32
LAPSE AND REINSTATEMENT	35
TAXES	36
DISTRIBUTION AND COMPENSATION	38
LEGAL PROCEEDINGS	39
FINANCIAL STATEMENTS	39
ADDITIONAL INFORMATION	39
DEFINITIONS OF SPECIAL TERMS USED IN THIS PROSPECTUS	40

SUMMARY OF CHARGES AND EXPENSES

Expenses other than Fund Expenses

The following tables describe the maximum fees and expenses that you could pay when buying, owning, and surrendering the Contract. Generally, our current fees and expenses are lower than the maximum fees and expenses reflected in the following tables. For more information about fees and expenses, see CHARGES AND EXPENSES.

The first table describes maximum fees and expenses that we deduct from each premium payment, and maximum fees we charge for purchases, surrenders, transfers and other transactions, and certain riders.



Table 1: Transaction and Optional Rider Fees
Charge	When Charge is Deducted	Amount Deducted
Sales Charge on Premiums (load)	Deducted from premium payments.	6%
Premium-Based Administrative Charge	Deducted from premium payments.	7.5%
Surrender Charge⁽¹⁾ (Minimum and maximum percentage of first year Sales Load Target Premium excluding premiums for riders and extras.) _____________ Initial surrender charge percentage for a representative Contract Owner: male, age 27	Upon lapse, surrender, or decrease in Basic Insurance Amount.	45% to 100% _____________ 100%
Transfer fee	Each transfer exceeding 12 in any Contract Year.	$25
Withdrawal fee	Upon withdrawal.	$25
Basic Insurance Amount Decrease fee	Upon decrease in Basic Insurance Amount.	$25
BenefitAccess Rider fee	One-time charge when the Terminal Illness Option of the rider is exercised.	$150
Living Needs Benefit^SM Rider fee	When benefit is paid.	$150
Overloan Protection Rider fee (percentage of the Contract Fund amount)	One-time charge upon exercising the rider benefit.	3.5%

(1)

The maximum surrender charge percentage of 100% applies to issue ages 0 to 48 in the early Contract Years. The percentage varies based on the issue age of the insured and Contract duration. The percentage reduces to zero by the end of the 10th year. For some older ages, the duration is as short as 3 years. You may obtain more information about the particular surrender charge percentage that applies to you by contacting your Pruco Life of New Jersey representative. See Surrender Cha rge .

The second table describes the maximum Contract fees and expenses that you may pay periodically during the time you own the Contract, not including the Funds’ fees and expenses.



Table 2: Periodic Contract and Optional Rider Charges Other Than the Fund's Operating Expenses
Charge	When Charge is Deducted	Amount Deducted
Cost of Insurance (“COI”) for the Basic Insurance Amount. Minimum and maximum charge per $1,000 of the Net Amount at Risk. _____________ Initial COI for a representative Contract Owner: male, age 27, nonsmoker underwriting class with no ratings. (Charge per $1,000 of the Net Amount at Risk.)	Monthly	From $.02 to $83.34⁽¹⁾⁽²⁾ _____________ $0.09
Administrative charge for Basic Insurance Amount Minimum and maximum charge (charge per $1,000 of Basic Insurance Amount plus a flat fee). _____________ Initial charge for Basic Insurance Amount for a representative Contract Owner: male, age 27, nonsmoker underwriting class. (Charge per $1,000 of Basic Insurance Amount plus a flat fee.)	Monthly	$0.07 to $1.53; plus $30 in the first Contract Year and $9 thereafter.⁽⁶⁾ _____________ $0.09 plus $30



Mortality and Expense Risk charge (Effective annual rate calculated as a percentage of assets in the Variable Investment Options.)	Daily	0.45%⁽³⁾
Additional Mortality charge for risk associated with certain health conditions, occupations, avocations, or aviation risks. (Flat extra per $1,000 of Basic Insurance Amount.)	Monthly	From $0.10 to $2.08⁽⁴⁾
Accidental Death Benefit Rider⁽⁷⁾ Minimum and maximum charge per $1,000 of the coverage amount. _____________ Accidental Death Benefit Rider charge for a representative Contract Owner: male, age 27, nonsmoker underwriting class. (Charge per $1,000 of the coverage amount.)	Monthly	From $0.05 to $0.28⁽⁶⁾ _____________ $0.06
BenefitAccess Rider (BAR) Minimum and maximum charge per $1,000 of the Net Amount at Risk. _____________ Initial BAR COI for a representative Contract Owner: male, age 27, Preferred Best underwriting class, $500,000 Basic Insurance Amount. (Charge per $1,000 of the Net Amount at Risk.)	Monthly	From $0.003 to $10.17⁽¹⁾ _____________ $0.005
Children Level Term Rider⁽⁷⁾ (Charge per $1,000 of the coverage amount.)	Monthly	$0.42
Enhanced Disability Benefit Rider⁽⁷⁾⁽⁸⁾ Minimum and maximum charge (percentage of the monthly benefit amount). _____________ Enhanced Disability Benefit Rider charge for a representative Contract Owner: male, age , nonsmoker underwriting class.	Monthly	From 7.08% to 12.17%⁽⁶⁾ _____________ 7.52%
Net interest on loans⁽⁵⁾	Annually	1% for standard loans. 0.05% for preferred loans.

(1)

The charge varies based on the individual characteristics of the insured, including such characteristics as age, sex, and underwriting classification, as well as Basic Insurance Amount and Contract duration. The charge shown in the table may not be representative of the charge that a particular Contract Owner will pay. You may obtain more information about the particular charges that apply to you by contacting your Pruco Life of New Jersey representative.


(2)	For example, the highest COI rate is for an insured who is a male/female age 120. You may obtain more information about the particular COI charges that apply to you by contacting your Pruco Life of New Jersey representative.


(3)	The daily charge is based on the effective annual rate shown.

(4)

The amount and duration of the charge will vary based on individual circumstances including issue age, type of risk, and the frequency of exposure to the risk, and is charged per $1,000 of Basic Insurance Amount. The charge shown in the table may not be representative of the charge that a particular Contract Owner will pay. You may obtain more information about the particular charges that apply to you by contacting your Pruco Life of New Jersey representative.


(5)	The net interest on loans reflects the net difference between a standard loan with an effective annual interest rate of 2% and an effective annual interest credit equal to 1%. Preferred loans are charged a lower effective annual interest rate. See Loans.


(6)	This charge varies based on the individual characteristics of the insured, including such characteristics as age, sex, and underwriting classification. You may obtain more information about the particular charges that apply to you by contacting your Pruco Life of New Jersey representative


(7)	Duration of the charge is limited. See CHARGES AND EXPENSES.


(8)	The monthly benefit amount is the greater of: 9% of the Contract's Limited No-Lapse Guarantee Premium (including premiums for riders and flat extras) and the total of all monthly deductions, and is charged until the first Contract Anniversary on or after the insured’s 60th birthday.

Fund Expenses

This table shows the minimum and maximum total operating expenses charged by the Funds that you will pay periodically during the time you own the Contract. More detail concerning each Fund’s fees and expenses is contained in the prospectus for each of the Funds. Fund prospectuses are available at www.prudential.com/eprospectus or by calling 800-944-8786.



Total Annual Fund Operating Expenses	Minimum	Maximum
(Expenses that are deducted from the Funds’ assets, including management fees, any distribution [and/or service] (12b-1) fees, and other expenses, but not including reductions for any fee waiver or other reimbursements.)	0.31%	1.20%

SUMMARY OF THE CONTRACT AND CONTRACT BENEFITS

Brief Description of the Contract

PruLife® Custom Premier II (2014) is a form of variable universal life insurance. A variable universal life insurance contract is a flexible form of life insurance. It has a Death Benefit and a Contract Fund, the value of which changes every day according to the investment performance of the investment options to which you have allocated your net premiums. You may allocate net premiums to one or more of the available Variable Investment Options or to the Fixed Rate Option. Although the value of your Contract Fund may increase if there is favorable investment performance in the Variable Investment Options you select, investment returns in the Variable Investment Options are not guaranteed. There is a risk that investment performance will be unfavorable and that the value of your Contract Fund will decrease. The risk will be different, depending upon which investment options you choose. You bear the risk of any decrease. If you select the Fixed Rate Option, we credit your account with a declared rate of interest, but you assume the risk that the rate may change, although it will never be lower than an effective annual rate of 1%. These amounts become part of our general account. The fulfillment of our guarantee is dependent on our claims paying ability. Transfers from the Fixed Rate Option may be restricted. The Contract is designed to be flexible to meet your specific life insurance needs. Within certain limits, the Contract will provide you with flexibility in determining the amount and timing of your premium payments. Some Contract forms, features and/or Variable Investment Options described in this prospectus may not be available through all brokers. The Contract form number for this Contract is VUL-2014. A state and/or other code may follow the form number. Your Contract's form number is located in the lower left hand corner on the first page of your Contract.

Types of Death Benefit Available Under the Contract

There are three types of Death Benefit available. You may choose a Contract with a Type A (fixed) Death Benefit under which the Death Benefit generally remains at the Basic Insurance Amount you initially chose. However, the Contract Fund (described below) may grow to a point where the Death Benefit may increase and vary with investment experience. If you choose a Contract with a Type B (variable) Death Benefit, your Death Benefit will vary with investment experience. For Contracts with Type A and Type B Death Benefits, as long as the Contract is in force , the Death Benefit will never be less than the Basic Insurance Amount shown in your Contract. If you choose a Contract with a Type C (return of premium) Death Benefit, the Death Benefit is generally equal to the Basic Insurance Amount plus the total premiums paid into the Contract, less withdrawals. The total premiums, less withdrawals, is not accumulated with interest. The Death Benefit on a Contract with a Type C Death Benefit is limited to the Basic Insurance Amount plus an amount equal to: the Contract Fund plus the Type C Limiting Amount (the Basic Insurance Amount) multiplied by the Type C Death Benefit Factor, both located in the Contract Limitations section of your Contract.

Any type of Death Benefit, described above, may be increased to ensure that the Contract will satisfy the Internal Revenue Code's definition of life insurance.

You may change your Contract’s Death Benefit type after issue; however, if you choose a Contract with a Type A Death Benefit or Type B Death Benefit at issue, you will not be able to change to a Contract with a Type C Death Benefit thereafter. Also, if you change a Contract with a Type C Death Benefit to a Contract with a Type A Death Benefit or Type B Death Benefit after issue, you will not be able to change back to a Contract with a Type C Death Benefit. See Types of Death Benefit and Changing the Type of Death Benefit.

No-Lapse Guarantee Information

Your Contract includes a feature, at no additional charge, that provides a limited guarantee against lapse. If you pay one of the two No-Lapse Guarantee Premiums described below, we will guarantee that your Contract will not lapse for the corresponding No-Lapse Guarantee Period as a result of unfavorable investment performance or an increase in charges, and a Death Benefit will be paid upon the death of the insured, even if your Contract Fund value drops to zero. The No-Lapse Guarantee is based on your premium payments and is not a benefit you need to elect. Withdrawals and outstanding Contract loans may adversely affect the status of the No-Lapse Guarantee. See Withdrawals and Loans.

Generally there are two No-Lapse Guarantee Premiums and No-Lapse Guarantee Periods. The No-Lapse Guarantee Premiums vary by Basic Insurance Amount, Death Benefit type, issue age, sex, underwriting classification, and the amount of any additional, optional benefits selected. See No-Lapse Guarantee, PREMIUMS, and DEATH BENEFITS.


1.	All Contracts have a Short Term No-Lapse Guarantee period, which has a corresponding Short Term No-Lapse Guarantee Premium. A Contract with a Type C (return of premium) Death Benefit will only have a Short Term No-Lapse Guarantee available.


2.	All Contracts without a Type C (return of premium) Death Benefit have a second, longer Limited No-Lapse Guarantee period with a corresponding Limited No-Lapse Guarantee Premium.

Unless a No-Lapse Guarantee is in effect, the Contract will go into default if the Contract Fund less any Contract Debt and less any applicable surrender charg e falls to zero or less. Your Pruco Life of New Jersey representative can tell you the premium amounts you will need to pay to maintain these guarantees.

The Contract Fund

Your Contract Fund value changes daily, reflecting: (1) increases or decreases in the value of the Funds; (2) interest credited on any amounts allocated to the Fixed Rate Option; (3) interest credited on any loan; and (4) the daily asset charge for mortality and expense risks assessed against the Variable Investment Options. The Contract Fund value also changes to reflect the receipt of premium payments, charges deducted from premium payments, the monthly deductions described under CHARGES AND EXPENSES, any withdrawals or accelerated benefits, and any added persistency credit. See Withdrawals, RIDERS, and Persistency Credit.

Premium Payments

You choose the timing and the amount of premium payments, with the exception of the minimum initial premium. All subsequent premium payments are subject to a minimum of $25 per payment. The Contract will remain in force if the Contract Fund less any applicable surrender charg e is greater than zero and more than any Contract Debt. Paying insufficient premiums, poor investment results, or the taking of loans or withdrawals from the Contract will increase the possibility that the Contract will lapse. However, if the premiums you paid, accumulated at an effective annual rate of 4%, less withdrawals also accumulated at 4% (“Accumulated Net Payments”) are at least equal to the amounts shown in the Table of No-Lapse Guarantee Values in your Contract Data pages, and there is no Contract Debt, we guarantee that your Contract will not lapse, even if investment experience is very unfavorable and the Contract Fund drops below zero. The length of time that the guarantee against lapse is available depends on your Contract's Death Benefit type. See PREMIUMS, No-Lapse Guarantee, and LAPSE AND REINSTATEMENT.

If you pay more premium than permitted under section 7702A of the Internal Revenue Code, your Contract would be classified as a Modified Endowment Contract, which would affect the federal income tax treatment of loans and withdrawals. For more information, see Tax Treatment of Contract Benefits - Modified Endowment Contracts.

Allocation of Premium Payments

When you apply for the Contract, you tell us how to allocate your premiums. You may change the way in which subsequent premiums are allocated by providing your request to us in Good Order at a Service Office. See The Pruco Life of New Jersey Variable Appreciable Account and Allocation of Premiums.

On the later of the Contract Date and the end of the Valuation Period in which the initial premium is received, we deduct the charge for sales expenses and the premium - based administrative charge from the initial premium. During the 10-day period following your receipt of the Contract, the remainder of the initial premium and any other net premium will be allocated to the money market investment option as of the end of the Valuation Period in which it is received in Good Order at the Payment Office. After the tenth day, these funds, adjusted for any investment results, will be transferred out of the money market investment option and allocated among the Variable Investment Options and/or the Fixed Rate Option according to your current premium allocation. See Canceling the Contract.

The charge for sales expenses and the premium - based administrative charge will also apply to all subsequent premium payments. The remainder of each subsequent premium payment will be invested as of the end of the Valuation Period in which it is received in Good Order at the Payment Office, in accordance with the applicable allocation instructions.

Investment Choices

You may choose to invest your Contract's premiums and its earnings in one or more of the available Variable Investment Options. You may also allocate premiums to the Fixed Rate Option. See The Funds and The Fixed Rate Option. You may transfer money among your investment choices, subject to restrictions. See Transfers/Restrictions on Transfers.

We may add or remove Variable Investment Options in the future.

Decreasing the Basic Insurance Amount

Subject to certain limitations, you have the option of decreasing the Basic Insurance Amount of your Contract after the issue of the Contract. See Decreases in Basic Insurance Amount. A decrease in Basic Insurance Amount may result in a surrender charge. See Surrender Charg e .

We may decline a decrease in the Basic Insurance Amount if we determine it would cause the Contract to fail to qualify as "life insurance" for purposes of Section 7702 of the Internal Revenue Code. In addition, if the Basic Insurance Amount is decreased, there is a possibility that the Contract will be classified as a Modified Endowment Contract. See Tax Treatment of Contract Benefits. We may decline a decrease in the Basic Insurance Amount if the Contract Fund value is less than any applicable partial surrender charg e .

No administrative processing charge is currently being made in connection with a decrease in Basic Insurance Amount. However, we reserve the right to charge such a fee in an amount of up to $25. See CHARGES AND EXPENSES.

A decrease in the Basic Insurance Amount is not allowed while receiving Benefit Payments under the BenefitAccess Rider. See BenefitAccess Rider.

Access to Contract Values

A Contract may be surrendered for its Cash Surrender Value (the Contract Fund minus any Contract Debt and minus any applicable surrender charge) while the insured is living. To surrender a Contract, we may require you to deliver or mail the Contract with a written request in Good Order to a Service Office. The Cash Surrender Value of a Contract will be determined as of the end of the Valuation Period in which such a request is received in Good Order in a Service Office. Surrender of a Contract may have tax consequences. See Surrender of a Contract and Tax Treatment of Contract Benefits.

Under certain circumstances, you may withdraw a part of the Contract's Cash Surrender Value without surrendering the Contract. The amount withdrawn must be at least $500. We may charge an administrative processing fee for each withdrawal in an amount up to $25. Currently, we do not charge a fee for withdrawals. Withdrawal of the Cash Surrender Value may have tax consequences. See Withdrawals and Tax Treatment of Contract Benefits.

Contract Loans

You may borrow money from us using your Contract as security for the loan, provided the Contract is not in default. The maximum loan amount is equal to the sum of (1) 99% of the portion of the cash value attributable to the Variable Investment Options and (2) the balance of the cash value, provided the Contract is not in default. The cash value is equal to the Contract Fund less any surrender charge. A Contract in default has no loan value. There is no minimum loan amount. See Loans.

Persistency Credit Information

If your Contract is not in default, on each Monthly Date beginning on the 6th Contract Anniversary, we will credit your Contract Fund with an additional amount for keeping your Contract in f orce. See the Persistency Credit section.

Canceling the Contract (“Free-Look”)

Generally, you may return the Contract for a refund within 10 days (60 days for certain circumstances) after you receive it. You will receive a refund of all premium payments made, less any applicable federal and/or state income tax withholding. A Contract returned according to this provision shall be deemed void from the beginning. The free-look period will be stated on the first page of your Contract.

SUMMARY OF CONTRACT RISKS

Contract Values Are Not Guaranteed

Your benefits (including life insurance) are not guaranteed, and may be entirely dependent on the investment performance of the Variable Investment Options you select. The value of your Contract Fund rises and falls with the performance of the Variable Investment Options you choose and the charges that we deduct. Poor investment performance or loans could cause your Contract to lapse and you could lose your insurance coverage. However, payment of the Death Benefit may be guaranteed under the No-Lapse Guarantee feature or may be protected under the Overloan Protection Rider. See No-Lapse Guarantee and Overloan Protection Rider.

The Variable Investment Options you choose may not perform to your expectations. Investing in the Contract involves risks including the possible loss of your entire investment. Only the Fixed Rate Option provides a guaranteed rate of return. For more detail, please see Risks Associated with the Variable Investment Options and The Fixed Rate Option.

Limitation of Benefits on Certain Riders for Claims Due to War or Service in the Armed Forces

We will not pay a benefit under the Accidental Death Benefit Rider or make payments under the Enhanced Disability Benefit Rider for any death or injury that is caused or contributed to by war or act of war, declared or undeclared, including resistance to armed aggression. This restriction includes service in the armed forces of any country at war.

Increase in Charges

In several instances we will use the terms “maximum charge” and “current charge.” The “maximum charge,” in each instance, is the highest charge that we may make under the Contract. The “current charge,” in each instance, is the amount that we now charge, which may be lower than the maximum charge. If circumstances change, we reserve the right to increase each current charge, up to the maximum charge. We will supplement this prospectus to reflect any increase in a current charge, up to the maximum charge, before the change is implemented.

Contract Lapse

Each month we determine the value of your Contract Fund. The Contract is in default if the Contract Fund, less any applicable surrender charg e, is zero or less, unless it remains in force under the No-Lapse Guarantee or BenefitAccess Rider. See No-Lapse Guarantee and BenefitAccess Rider. Your Contract will also be in default if, at any time, the Contract Debt equals or exceeds the Contract Fund, less any applicable surrender charg e, unless it remains in force under the Overloan Protection Rider. See Loans and Overloan Protection Rider. If you have an outstanding loan when your Contract lapses, you may have taxable income as a result. See Tax Treatment of Contract Benefits - Pre-Death Distributions.

Should any event occur that would cause your Contract to lapse, we will notify you of the required payment to prevent your Contract from terminating. A 61-day grace period will begin from the date the notice of default is mailed. Your payment must be received or postmarked within the 61-day grace period or the Contract will end and have no value. To prevent your Contract from lapsing, your payment must be in Good Order when received at the Payment Office. See LAPSE AND REINSTATEMENT.

Risks of Using the Contract as a Short-Term Savings Vehicle

The Contract is designed to provide benefits on a long-term basis. Consequently, you should not purchase the Contract as a short-term investment or savings vehicle. Because of the long-term nature of the Contract, you should consider whether purchasing the Contract is consistent with the purpose for which it is being considered.

Because the Contract provides for an accumulation of a Contract Fund as well as a Death Benefit, you may wish to use it for various insurance planning purposes. Purchasing the Contract for such purposes may involve certain risks.

For example, a life insurance contract could play an important role in helping you to meet the future costs of a child’s education. The Contract’s Death Benefit could be used to provide for education costs should something happen to you, and its investment features could help you accumulate savings. However, if the Variable Investment Options you choose perform poorly, if you do not pay sufficient premiums, or if you access the values in your Contract through withdrawals or Contract loans, your Contract may lapse or you may not accumulate the value you need.

Risks of Taking Withdrawals

If your Contract meets certain requirements, you may make withdrawals from your Contract’s Cash Surrender Value while the Contract is in force. The amount withdrawn must be at least $500. The withdrawal amount is limited by the requirement that the Cash Surrender Value after withdrawal may not be less than or equal to zero after deducting any charges associated with the withdrawal and an amount that we estimate will be sufficient to cover the Contract Fund deductions for two Monthly Dates following the date of withdrawal. We may charge an administrative processing fee of up to $25 for each withdrawal. Currently, we do not charge a fee for withdrawals. Withdrawal of the Cash Surrender Value may have tax consequences. See Tax Treatment of Contract Benefits.

Whenever a withdrawal is made, the Death Benefit may immediately be reduced by at least the amount of the withdrawal. A surrender charge may be deducted when any withdrawal causes a reduction in the Basic Insurance Amount. See Surrender Charg e . Withdrawals from Contracts with a Type B Death Benefit or Type C Death Benefit will not change the Basic Insurance Amount. However, under most circumstances, withdrawals from a Contract with a Type A Death Benefit require a reduction in the Basic Insurance Amount. No withdrawal will be permitted under a Contract with a Type A Death Benefit if it would result in a Basic Insurance Amount of less than the minimum Basic Insurance Amount. See REQUIREMENTS FOR ISSUANCE OF A CONTRACT.

It is important to note, however, that if the Basic Insurance Amount is decreased, there is a possibility that the Contract might be classified as a Modified Endowment Contract. Accessing the values in your Contract through withdrawals may significantly affect current and future Contract values or Death Benefit proceeds and may increase the chance that your Contract will lapse. Before making any withdrawal that causes a decrease in Basic Insurance Amount, you should consult with your tax adviser and your Pruco Life of New Jersey representative. See Withdrawals and Tax Treatment of Contract Benefits.

Withdrawals are not allowed while receiving Benefit Payments under the BenefitAccess Rider. See BenefitAccess Rider.

Risks of Taking a Contract Loan

Accessing the values in your Contract through Contract loans may significantly affect current and future Contract values or Death Benefit proceeds and may increase the chance that your Contract will lapse. Your Contract will be in default if, at any time, the Contract Debt equals or exceeds the Contract Fund, less any applicable surrender charg e, even if the No-Lapse Guarantee is in effect. If the Contract lapses or is surrendered, the amount of unpaid Contract Debt will be treated as a distribution and will be immediately taxable to the extent of the gain in the Contract. In addition, if your Contract is a Modified Endowment Contract for tax purposes, taking a Contract loan may have tax consequences. See Tax Treatment of Contract Benefits.

Loan Repayments are required when exercising the BenefitAccess Rider. See BenefitAccess Rider.

Limitations on Transfers

You may, up to 12 times each Contract Year, transfer amounts among the Variable Investment Options or to the Fixed Rate Option. Additional transfers may be made only with our consent. Currently, we allow you to make additional transfers. We may charge up to $25 for each transfer made exceeding 12 in any Contract Year. Currently, we do not charge a fee for transfers.

For the first 20 transfers in a calendar year, you may transfer amounts by providing your request to us in Good Order at a Service Office. See Transfers/Restrictions on Transfers. We use reasonable procedures to confirm that instructions given by telephone are genuine. However, we are not liable for following telephone instructions that we reasonably believe to be genuine. In addition, we cannot guarantee that you will be able to get through to complete a telephone transfer during peak periods such as periods of drastic economic or market change.

After you have submitted 20 transfers in a calendar year, we will accept subsequent transfer requests only if they bear an original signature in ink, are received in Good Order at a Service Office, and are sent to us by U.S. regular mail. After you have submitted 20 transfers in a calendar year, a subsequent transfer request by telephone, fax, or website will be rejected, even in the event that it is inadvertently processed.

In addition, you may use our dollar cost averaging feature or our automatic rebalancing feature. Currently, transfers effected systematically under either a dollar cost averaging or an automatic rebalancing program described in this prospectus do not count towards the limit of 12 transfers per Contract Year or the limit of 20 transfers per calendar year. In the future, we may count such transfers towards the limit. See Transfers/Restrictions on Transfers, Dollar Cost Averaging, and Auto-Rebalancing.

Multiple transfers that occur during the same day, but prior to the end of the Valuation Period for that day, will be counted as a single transfer.

Generally, only one transfer from the Fixed Rate Option is permitted during each Contract Year. The maximum amount per Contract you may transfer out of the Fixed Rate Option each year is the greater of: (a) 25% of the amount in the Fixed Rate Option; and (b) $2,000.

You may also transfer amounts from the Variable Investment Option to the Fixed Rate Option at any tim e within 18 months from the Contract Date, and within the later of 60 days from the effective date of a material change in the investment policy of a Variable Investment Option and 60 days from the notice of that change, with no restriction. Such transfers do not count toward the twelve transfers allowed in each Contract Year.

We may modify your right to make transfers by restricting the number, timing and/or amount of transfers we find to be disruptive to the investment option or to the disadvantage of other Contract Owners. We also reserve the right to prohibit transfer requests made by an individual acting under a power of attorney on behalf of more than one Contract Owner. We will immediately notify you at the time of a transfer request if we exercise this right.

Transfer restrictions will be applied uniformly and will not be waived. See Transfers/Restrictions on Transfers.

Charges on Surrender of the Contract

You may surrender your Contract at any time for its Cash Surrender Value while the insured is living. We deduct a surrender charge from the surrender proceeds. In addition, the surrender of your Contract may have tax consequences. See Tax Treatment of Contract Benefits.

We will assess a surrender charge if, during the first 10 Contract Years, the Contract lapses, is surrendered, or the Basic Insurance Amount is decreased (including as a result of a withdrawal or a Death Benefit type change). The surrender charge varies and is calculated as described in Surrender Charg e . While the amount of the surrender charge decreases over time, it may be a substantial portion or even equal to your Contract Fund.

Potential Tax Consequences

Your Contract is structured to meet the definition of life insurance under Section 7702 of the Internal Revenue Code. At issue, the Contract Owner chooses one of the following definitions of life insurance tests: (1) Cash Value Accumulation Test or (2) Guideline Premium Test. Under the Cash Value Accumulation Test, there is a minimum Death Benefit to Contract Fund value ratio. Under the Guideline Premium Test, there is a limit to the amount of premiums that can be paid into the Contract, as well as a minimum Death Benefit to Contract Fund value ratio. Consequently, we reserve the right to refuse to accept a premium payment that would, in our opinion, cause this Contract to fail to qualify as life insurance. We also have the right to refuse to accept any premium payment that increases the Death Benefit by more than it increases the Contract Fund. Although we believe that the Contract should qualify as life insurance for tax purposes, there are some uncertainties, particularly because the Secretary of Treasury has not yet issued permanent regulations that bear on this question. Accordingly, we reserve the right to make changes -- which will be applied uniformly to all Contract Owners after advance written notice -- that we deem necessary to insure that the Contract will qualify as life insurance. We require the Guideline Premium Test as the definition of life insurance if you choose to have the Overloan Protection Rider. See Overloan Protection Rider.

Current federal tax law generally excludes all Death Benefits from the gross income of the beneficiary of a life insurance contract. However, your Death Benefit could be subject to estate tax. In addition, you generally are not subject to taxation on any increase in the Contract value until it is withdrawn. Generally, you are taxed on surrender proceeds and the proceeds of any partial withdrawals only if those amounts, when added to all previous distributions, exceed the total premiums paid. Amounts received upon surrender or withdrawal (including any outstanding Contract loans) in excess of premiums paid are treated as ordinary income.

Special rules govern the tax treatment of life insurance policies that meet the federal definition of a Modified Endowment Contract. The Contract could be classified as a Modified Endowment Contract if premiums in amounts that are too large are paid or a decrease in the Basic Insurance Amount is made (or a rider removed). We will notify you if payment of a premium or a reduction in Basic Insurance Amount would cause the Contract to become a Modified Endowment Contract, and advise you of your options.

Under current tax law, Death Benefit payments under Modified Endowment Contracts, like Death Benefit payments under other life insurance contracts, generally are excluded from the gross income of the beneficiary. However, amounts you receive under the Contract before the insured's death, including loans and withdrawals, are included in income to the extent that the Contract Fund before surrender charges exceeds the premiums paid for the Contract increased by the amount of any loans previously included in income and reduced by any untaxed amounts previously received other than the amount of any loans excludible from income. An assignment of a Modified Endowment Contract is taxable in the same way. These rules also apply to pre-death distributions, including loans and assignments, made during the two-year period before the time that the Contract became a Modified Endowment Contract.

All Modified Endowment Contracts issued by us to you during the same calendar year are treated as a single Contract for purposes of applying these rules. See Tax Treatment of Contract Benefits.

Any taxable income on pre-death distributions (including full surrenders) is subject to a penalty of 10 percent unless the amount is received on or after age 59½, on account of your becoming disabled or as a life annuity. It is presently unclear how the penalty tax provisions apply to Contracts owned by businesses.

Replacement of a Contract

The replacement of life insurance is generally not in your best interest. If you are considering purchasing this Contract to replace an existing contract, you should first consider other options. In some cases, if you require additional life insurance coverage, the benefits of your existing contract can be protected by increasing the insurance amount of your existing contract, if permitted, or by purchasing an additional contract. If you are considering replacing a contract, you should compare the benefits and costs of supplementing your existing contract with the benefits and costs of purchasing a new Contract from us and you should consult with a tax adviser.

SUMMARY OF RISKS ASSOCIATED WITH THE VARIABLE INVESTMENT OPTIONS

You may choose to invest your Contract's premiums and its earnings in one or more of the available Variable Investment Options. You may also allocate premiums to the Fixed Rate Option. The Fixed Rate Option is the only investment option that offers a guaranteed rate of return. See The Funds and The Fixed Rate Option.

Risks Associated with the Variable Investment Options

The Separate Account invests in the shares of one or more open-end management investment companies registered under the Investment Company Act of 1940. Each Variable Investment Option, which invests in a corresponding Fund, has its own investment objective and associated risks, which are described in the Fund prospectuses. The income, gains, and losses of one Variable Investment Option have no effect on the investment performance of any other Variable Investment Option.

We do not promise that the Funds will meet their investment objectives. Amounts you allocate to the Variable Investment Options may grow in value, decline in value or grow less than you expect, depending on the investment performance of the Funds. You bear the investment risk that the Funds may not meet their investment objectives. It is possible to lose your entire investment in the Variable Investment Options. Although the PSF Government Money Market Portfolio is designed to be a stable investment option, it is possible to lose money in that Variable Investment Option. For example, when prevailing short-term interest rates are very low, the yield on the PSF Government Money Market Portfolio may be so low that, when Fund and Contract charges are deducted, you experience a negative return. See The Funds.

The Contract offers Variable Investment Options through the Advanced Series Trust ("AST"). The AST Variable Investment Options are also available in variable annuity contracts we offer. Some of these variable annuity contracts offer optional living benefits that utilize a predetermined mathematical formula (the “formula”) to manage the guarantees offered in connection with those optional benefits. The formula monitors each annuity contract owner’s account value daily and, if necessary, will systematically transfer amounts among investment options. The formula transfers funds between the Variable Investment Options for those variable annuity contracts and an AST bond p ortfolio (those AST bond p ortfolios are not available in connection with the life Contracts offered through this prospectus). You should be aware that the operation of the formula in those variable annuity contracts may result in large-scale asset flows into and out of the Funds corresponding to the Variable Investment Options that are available with your Contract. These asset flows could adversely impact the Funds, including their risk profile, expenses and performance. Because transfers between the Variable Investment Options and the AST bond p ortfolio can be frequent and the amount transferred can vary from day to day, any of the Funds could experience the following effects, among others:


(1)	a Fund’s investment performance could be adversely affected by requiring a subadviser to purchase and sell securities at inopportune times or by otherwise limiting the subadviser’s ability to fully implement the Fund’s investment strategy;


(2)	the subadviser may be required to hold a larger portion of assets in highly liquid securities than it otherwise would hold, which could adversely affect performance if the highly liquid securities underperform other securities (e.g., equities) that otherwise would have been held; and


(3)	a Fund may experience higher turnover and greater negative asset flows than it would have experienced without the formula, which could result in higher operating expense ratios and higher transaction costs for the Fund compared to other similar funds.

The efficient operation of the asset flows among Funds triggered by the formula depends on active and liquid markets. If market liquidity is strained, the asset flows may not operate as intended. For example, it is possible that illiquid markets or other market stress could cause delays in the transfer of cash from one Fund to another Fund, which in turn could adversely impact performance.

Before you allocate to the Variable Investment Options with the AST Portfolios listed below, you should consider the potential effects on the Funds that are the result of the operation of the formula in the variable annuity contracts that are unrelated to your Contract. Please work with your financial professional to determine which Variable Investment Options are appropriate for your needs.

Learn More about the Variable Investment Options

Before allocating amounts to the Variable Investment Options, you should read the current Fund prospectuses for detailed information concerning their investment objectives, strategies, and investment risks. The Funds' prospectuses are available at www.prudential.com/eprospectus or by calling 800-944-8786.

GENERAL DESCRIPTIONS OF PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY, THE REGISTRANT, AND THE FUNDS

Pruco Life Insurance Company of New Jersey

Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey", “us”, “we”, or “our”) is a stock life insurance company, organized on September 17, 1982 , under the laws of the state of New Jersey. It is licensed to sell life insurance and annuities only in the states of New Jersey and New York. Our principal executive office is located at 213 Washington Street, Newark, New Jersey 07102.

The Pruco Life of New Jersey Variable Appreciable Account

We have established a Separate Account, the Pruco Life of New Jersey Variable Appreciable Account (the "Account", or the "Registrant") to hold the assets that are associated with the Contracts. The Account was established on January 13, 1984, under New Jersey law and is registered with the SEC under the Investment Company Act of 1940 as a unit investment trust, which is a type of investment company. The Account meets the definition of a "Separate Account" under the federal securities laws. The Account holds assets that are segregated from all of our other assets. Thus, such assets that are held in support of client accounts are not chargeable with liabilities arising out of any other business Pruco Life Insurance Company of New Jersey conducts.

We are the legal owner of the assets in the Account. We will maintain assets in the Account with a total market value at least equal to the reserve and other liabilities relating to the variable benefits attributable to the Contracts. In addition to these assets, the Account's assets may include funds contributed by us to commence operation of the Account and may include accumulations of the charges we make against the Account. From time to time we will transfer capital contributions to our general account. We will consider any possible adverse impact the transfer might have on the Account before making any such transfer.

Income, gains and losses credited to, or charged against, the Account reflect the Account’s own investment experience and not the investment experience of our other assets. The assets of the Account that are held in support of client accounts may not be charged with liabilities that arise from any other business we conduct.

We are obligated to pay all amounts promised to Contract Owners under the Contract. The obligations to Contract Owners and beneficiaries arising under the Contracts are our general corporate obligations. Guarantees and benefits within the Contract are subject to our claims paying ability.

You may invest in one or a combination of the available Variable Investment Options. When you choose a Variable Investment Option, we purchase shares of a Fund or a separate investment series of a Fund which are held as an investment for that option. We hold these shares in the Account. We may remove or add additional Variable Investment Options in the future.

The Funds

This Contract offers Funds managed by AST Investment Services, Inc. and/or PGIM Investments LLC, both of which are affiliated companies of Pruco Life of New Jersey (“Affiliated Funds”), and Funds managed by companies not affiliated with Pruco Life of New Jersey ("Unaffiliated Funds"). Pruco Life of New Jersey and its affiliates (“Prudential Companies”) receive fees and payments from both the Affiliated Funds and the Unaffiliated Funds. We consider the amount of these fees and payments when determining which funds to offer through the Contract. Affiliated Funds may provide Prudential Companies with greater fees and payments than Unaffiliated Funds. Because of the potential for greater profits earned by the Prudential Companies with respect to the Affiliated Funds, we have an incentive to offer Affiliated Funds over Unaffiliated Funds. As indicated next to each Fund's description in the tables that follow, each Fund has one or more subadvisers that provide certain day-to-day investment management services. We have an incentive to offer Funds with certain subadvisers, either because the subadviser is a Prudential Company or because the subadviser provides payments or support, including distribution and marketing support, to the Prudential Companies. We may consider those subadviser financial incentive factors in determining which Funds to offer under the Contract. Also, in some cases, we offer Funds based on the recommendations made by selling broker-dealer firms. These firms may receive payments from the Funds they recommend and may benefit accordingly from allocations of Contract Fund value to the Variable Investment Options that invest in these Funds. Allocations made to all Affiliated Funds benefit us financially. Pruco Life of New Jersey has selected the Funds for inclusion as investment options under this Contract in Pruco Life of New Jersey’s role as issuer of this Contract, and Pruco Life of New Jersey does not provide investment advice or recommend any particular Fund. See Service Fees Payable to Pruco Life of New Jersey following the table below for more information about fees and payments we may receive from the Funds and/or their affiliates.

In addition, we may consider the potential risk to us of offering a fund in light of the benefits provided by the Contract.

Each Fund is detailed in its own separate prospectus. The Fund's prospectus and statement of additional information is available at www.prudential.com/eprospectus or by calling 800-944-8786. You should read the Fund prospectuses before you decide to allocate assets to the Variable Investment Options. We will also provide you with the prospectus for each Fund in which you invest. The Variable Investment Options that you select are your choice – we do not provide investment advice, nor do we recommend any particular Variable Investment Option. There is no assurance that the investment objectives of the Funds will be met. Please refer to the lists below to see which Variable Investment Options you may choose.

The terms “Fund” and “Portfolio” are largely used interchangeably. Some of the Funds use the term “Fund”, and others use the term “Portfolio” in their respective prospectuses.

Investment Managers

PGIM Investments LLC serves as the investment manager for The Prudential Series Fund ("PSF") and certain Funds of AST . PGIM Investments LLC and AST Investment Services, Inc. serve as co-investment managers of the other Funds of AST.

The investment management agreements for PSF and AST provide that the investment manager or co-investment managers (the “Investment Managers”) will furnish each applicable Fund with investment advice and administrative services subject to the supervision of the Board of Trustees and in conformity with the stated policies of the applicable Fund. The Investment Managers must also provide, or obtain and supervise, the executive, administrative, accounting, custody, transfer agent and shareholder servicing services that are deemed advisable by the Board of Trustees of the applicable Fund.

The Investment Managers and subadvisers for the Funds charge a daily investment management fee as compensation for their services. Allocations made to all AST and PSF Funds benefit us financially because fees are paid to us or our affiliates by the AST and PSF Funds. More detailed information, including a full description of these fees, is available in the Fund prospectuses.

In the future, it may become disadvantageous for separate accounts of variable life insurance and variable annuity contracts to invest in the same Funds. Neither the companies that invest in the Funds nor the Funds currently foresee any such disadvantage. The Board of Directors for each Fund intends to monitor events in order to identify any material conflict between variable life insurance and variable annuity Contract Owners and to determine what action, if any, should be taken. Material conflicts could result from such things as:


(1)	changes in state insurance law;


(2)	changes in federal income tax law;


(3)	changes in the investment management of any Fund; or


(4)	differences between voting instructions given by variable life insurance and variable annuity Contract Owners.

A Fund may have a similar name, investment objective, or investment policy resembling those of a mutual fund managed by the same investment adviser or subadviser that is sold directly to the public. Despite such similarities, there can be no assurance that the investment performance of any such Fund will resemble that of the publicly available mutual fund.

The tables below reflect the Funds in which the Account invests, their investment objectives, and each Fund’s investment subadvisers. For Funds with multiple subadvisers, each subadviser manages a portion of the assets for that Fund. The AST Balanced Asset Allocation Portfolio and the AST Preservation Asset Allocation Portfolio each invests primarily in shares of other Funds, which are managed by the subadvisers of those Funds.



Affiliated Funds
Fund	Investment Objective Summary	Subadviser
ADVANCED SERIES TRUST
AST Balanced Asset Allocation Portfolio	Seeks to obtain the highest potential total return consistent with its specified level of risk tolerance.	PGIM Investments LLC; QMA LLC
AST BlackRock Global Strategies Portfolio	Seeks a high total return consistent with a moderate level of risk.	BlackRock Financial Management, Inc.; BlackRock International Limited
AST BlackRock Low Duration Bond Portfolio	Seeks to maximize total return, consistent with income generation and prudent investment management.	BlackRock Financial Management, Inc
AST BlackRock/Loomis Sayles Bond Portfolio	Seek to maximize total return, consistent with preservation of capital and prudent investment management.	BlackRock Financial Management, Inc.; BlackRock International Limited; BlackRock (Singapore) Limited; Loomis, Sayles & Company, L.P.
AST Cohen & Steers Realty Portfolio	Seeks to maximize total return through investment in real estate securities.	Cohen & Steers Capital Management, Inc.
AST Hotchkis & Wiley Large-Cap Value Portfolio	Seeks current income and long-term growth of income, as well as capital appreciation.	Hotchkis & Wiley Capital Management, LLC
AST International Value Portfolio	Seeks capital growth.	Lazard Asset Management LLC; LSV Asset Management
AST J.P. Morgan International Equity Portfolio	Seeks capital growth.	J.P. Morgan Investment Management, Inc.
AST J.P. Morgan Strategic Opportunities Portfolio	Seeks to maximize return compared to the benchmark through security selection and tactical asset allocation.	J.P. Morgan Investment Management, Inc.
AST Loomis Sayles Large-Cap Growth Portfolio	Seeks capital growth. Income realization is not an investment objective and any income realized on the Portfolio’s investments, therefore, will be incidental to the Portfolio’s objective.	Loomis, Sayles & Company, L.P.
AST MFS Global Equity Portfolio	Seeks capital growth.	Massachusetts Financial Services Company
AST MFS Growth Portfolio	Seeks long-term capital growth and future, rather than current income.	Massachusetts Financial Services Company
AST Mid-Cap Growth Portfolio (formerly AST Goldman Sachs Mid-Cap Growth Portfolio)	Seeks long-term growth of capital.	Massachusetts Financial Services Company; Victory Capital Management Inc.
AST Preservation Asset Allocation Portfolio	Seeks to obtain the highest potential total return consistent with its specified level of risk tolerance.	PGIM Investments LLC; QMA LLC
AST Small-Cap Growth Opportunities Portfolio	Seeks capital growth.	Victory Capital Management Inc.; Wellington Management Company, LLP
AST Small-Cap Growth Portfolio	Seeks long-term capital growth.	Emerald Mutual Fund Advisers Trust; UBS Asset Management (Americas) Inc.
AST Small-Cap Value Portfolio	Seeks to provide long-term capital growth by investing primarily in small-capitalization stocks that appear to be undervalued.	J.P. Morgan Investment Management, Inc.; LMCG Investments, LLC
AST T. Rowe Price Large-Cap Growth Portfolio	Seeks long-term growth of capital by investing predominantly in the equity securities of a limited number of large, carefully selected, high-quality U.S. companies that are judged likely to achieve superior earnings growth.	T. Rowe Price Associates, Inc.



Affiliated Funds
Fund	Investment Objective Summary	Subadviser
AST T. Rowe Price Large-Cap Value Portfolio	Seeks maximum growth of capital by investing primarily in the value stocks of larger companies.	T. Rowe Price Associates, Inc.
AST T. Rowe Price Natural Resources Portfolio	Seeks long-term capital growth primarily through the investment in the common stocks of companies that own or develop natural resources (such as energy products, precious metals and forest products) and other basic commodities.	T. Rowe Price Associates, Inc.
AST Templeton Global Bond Portfolio	Seeks to provide current income with capital appreciation and growth of income.	Franklin Advisers, Inc.
AST Wellington Management Hedged Equity Portfolio	Seeks to outperform a mix of 50% Russell 3000 Index, 20% MSCI Europe, Australasia and the Far East (EAFE) Index, and 30% Bank of America Merrill Lynch Three-Month US Treasury Bill Index over a full market cycle by preserving capital in adverse markets utilizing an options strategy while maintaining equity exposure to benefit from up markets through investments in the Portfolio's subadviser's equity investment strategies.	Wellington Management Company LLP
THE PRUDENTIAL SERIES FUND
PSF Diversified Bond Portfolio - Class I	Seeks a high level of income over a longer term while providing reasonable safety of capital.	PGIM Fixed Income
PSF Equity Portfolio - Class I	Seeks long-term growth of capital.	Jennison Associates LLC
PSF Global Portfolio - Class I	Seeks long-term growth of capital.	Brown Advisory, LLC; LSV Asset Management; QMA LLC; T. Rowe Price Associates, Inc.; William Blair Investment Management, LLC
PSF Government Money Market Portfolio - Class I	Seeks maximum current income consistent with the stability of capital and the maintenance of liquidity.	PGIM Fixed Income
PSF High Yield Bond Portfolio - Class I	Seeks high total return.	PGIM Fixed Income
PSF Jennison Portfolio - Class I	Seeks long-term growth of capital.	Jennison Associates LLC
PSF Jennison 20/20 Focus Portfolio - Class I	Seeks long-term growth of capital.	Jennison Associates LLC
PSF Natural Resources Portfolio - Class I	Seeks long-term growth of capital.	Allianz Global Investors U.S. LLC
PSF Small Capitalization Stock Portfolio - Class I	Seeks long-term growth of capital.	QMA LLC
PSF SP International Growth Portfolio - Class I	Seeks long-term growth of capital.	Jennison Associates LLC; Neuberger Berman Investment Advisers LLC ; William Blair Investment Management, LLC
PSF SP Prudential U.S. Emerging Growth Portfolio - Class I	Seeks long-term capital appreciation.	J.P. Morgan Investment Management, Inc.
PSF SP Small Cap Value Portfolio - Class I	Seeks long-term growth of capital.	Goldman Sachs Asset Management, L.P.
PSF Stock Index Portfolio - Class I	Seeks to achieve investment results that generally correspond to the performance of publicly-traded common stocks.	QMA LLC
PSF Value Portfolio - Class I	Seeks capital appreciation.	Jennison Associates LLC



Unaffiliated Funds
Fund	Investment Objective Summary	Investment Adviser/Subadviser
AMERICAN CENTURY VARIABLE PORTFOLIO, INC.
American Century VP Mid Cap Value Fund - Class I	Seeks long-term capital growth. Income is a secondary objective.	American Century Investment Management, Inc.
AMERICAN FUNDS INSURANCE SERIES®
American Funds Insurance Series® Growth Fund - Class 2	Seeks to provide growth of capital.	Capital Research and Management Company^SM
American Funds Insurance Series® Growth-Income Fund - Class 2	Seeks to achieve long-term growth of capital and income.	Capital Research and Management Company^SM
American Funds Insurance Series® International Fund - Class 2	Seeks to provide long-term growth of capital.	Capital Research and Management Company^SM
DREYFUS
The Dreyfus Sustainable U.S. Equity Portfolio, Inc. - Service Shares	Seeks long-term capital appreciation.	The Dreyfus Corporation/Newton Investment Management (North America) Limited
DREYFUS INVESTMENT PORTFOLIOS
Dreyfus Midcap Stock Portfolio - Service Shares	Seeks investment results that are greater than the total return performance of publicly traded common stocks of medium-size domestic companies in the aggregate, as represented by the Standard & Poor's MidCap 400® Index (S&P 400).	The Dreyfus Corporation
FIDELITY® VARIABLE INSURANCE PRODUCTS
Fidelity® VIP Contrafund^SM Portfolio - Service Class 2	Seeks long-term capital appreciation.	Fidelity Management & Research Company/FMR Co. Inc., and other investment advisers
Fidelity® VIP Mid Cap Portfolio - Service Class 2	Seeks long-term growth of capital.	Fidelity Management & Research Company/FMR Co. Inc., and other investment advisers
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
Franklin Income VIP Fund - Class 2	Seeks to maximize income while maintaining prospects for capital appreciation.	Franklin Advisers, Inc.
Franklin Mutual Shares VIP Fund - Class 2	Seeks capital appreciation, with income as a secondary goal.	Franklin Mutual Advisers, LLC
Templeton Growth VIP Fund - Class 2	Seeks long-term capital growth.	Templeton Global Advisors Limited
HARTFORD SERIES FUND, INC.
Hartford Capital Appreciation HLS Fund - Class IB	Seeks growth of capital.	Hartford Funds Management Company, LLC/Wellington Management Company LLP
Hartford Disciplined Equity HLS Fund - Class IB	Seeks growth of capital.	Hartford Funds Management Company, LLC/Wellington Management Company LLP
Hartford Dividend and Growth HLS Fund - Class IB	Seeks a high level of current income consistent with growth of capital.	Hartford Funds Management Company, LLC/Wellington Management Company LLP
HARTFORD HLS SERIES FUND II, INC.
Hartford Growth Opportunities HLS Fund - Class IB	Seeks capital appreciation.	Hartford Funds Management Company, LLC/Wellington Management Company LLP
JANUS ASPEN SERIES
Janus Henderson Overseas Portfolio - Service Shares	Seeks long-term growth of capital.	Janus Capital Management LLC



Unaffiliated Funds
Fund	Investment Objective Summary	Investment Adviser/Subadviser
MFS® VARIABLE INSURANCE TRUST
MFS® Total Return Bond Series - Initial Class	Seeks total return with an emphasis on current income, but also considering capital appreciation.	Massachusetts Financial Services Company
MFS® Utilities Series - Initial Class	Seeks total return.	Massachusetts Financial Services Company
MFS® Value Series - Initial Class	Seeks capital appreciation.	Massachusetts Financial Services Company
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST
Neuberger Berman AMT Sustainable Equity Portfolio - Class S	Seeks long-term growth of capital by investing primarily in securities of companies that meet the Fund’s environmental, social and governance (ESG) criteria.	Neuberger Berman Investment Advisers LLC
TOPS - THE OPTIMIZED PORTFOLIO SYSTEM®
TOPS® Aggressive Growth ETF Portfolio - Class 2	Seeks capital appreciation.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Balanced ETF Portfolio - Class 2	Seeks income and capital appreciation.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Conservative ETF Portfolio - Class 2	Seeks to preserve capital and provide moderate income and moderate capital appreciation.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Growth ETF Portfolio - Class 2	Seeks capital appreciation.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Managed Risk Balanced ETF Portfolio - Class 2	Seeks to provide income and capital appreciation with less volatility than the fixed income and equity markets as a whole.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Managed Risk Growth ETF Portfolio - Class 2	Seeks capital appreciation with less volatility than the equity markets as a whole.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Managed Risk Moderate Growth ETF Portfolio - Class 2	Seeks capital appreciation with less volatility than the equity markets as a whole.	ValMark Advisers, Inc./Milliman Inc.
TOPS® Moderate Growth ETF Portfolio - Class 2	Seeks capital appreciation.	ValMark Advisers, Inc./Milliman Inc.

Service Fees Payable to Pruco Life of New Jersey

We and our affiliates receive substantial payments from the Funds and/or related entities, such as the Funds’ advisers and subadvisers. Because these fees and payments are made to us and our affiliates, allocations you make to the Funds benefit us financially.

We receive Rule 12b-1 fees which compensate us and our affiliate, Pruco Securities, LLC ("Pruco Securities") , for distribution and administrative services. These fees are paid by the Funds out of each Fund’s assets and are therefore borne by Contract Owners. We also receive administrative services payments, some of which are paid by the Funds and some of which are paid by the advisers of the Funds or their affiliates and are referred to as “revenue sharing” payments. As of May 1, 2019 , the maximum combined 12b-1 fees and administrative services payments we receive with respect to a Fund are equal to an annual rate of 0.55% of the average assets allocated to the Fund under the Contract. We expect to make a profit on these fees and payments and consider them when selecting the Funds available under the Contract.

In addition, an adviser or subadviser of a Fund or a distributor of the Contract may also compensate us by providing reimbursement, defraying the costs of, or paying directly for, among other things, marketing and/or administrative services and/or other services they provide in connection with the Contract. These services may include, but are not limited to: sponsoring or co-sponsoring various promotional, educational or marketing meetings and seminars attended by distributors, wholesalers, and/or broker-dealer firms’ registered representatives, and creating marketing material discussing the Contract, available options, and Funds. The amounts paid depend on the nature of the meetings, the number of meetings attended by the adviser, subadviser, or distributor, the number of participants and attendees at the meetings, the costs expected to be incurred, and the level of the adviser’s, subadviser’s or distributor’s participation. These payments or reimbursements may not be offered by all advisers, subadvisers, or distributors and the amounts of such payments may vary between and among each adviser, subadviser, and distributor depending on their respective participation.

In addition to the payments that we receive from Funds and/or their affiliates, those same Funds and/or their affiliates may make payments to us and/or other insurers within the Prudential Companies related to the offering of investment options within variable annuities or life insurance offered by different Prudential business units.

Voting Rights

We are the legal owner of the shares of the Funds associated with the Variable Investment Options. However, we vote the shares according to voting instructions we receive from Contract Owners. We will mail you a proxy, which is a form you need to complete and return to us, to inform us how you wish us to vote. When we receive those instructions, we will vote all of the shares we own on your behalf in accordance with those instructions. We vote shares for which we do not receive instructions, and any other shares that we own in our own right, in the same proportion as the shares for which instructions are received. This voting procedure is sometimes referred to as “mirror voting” because, as indicated in the immediately preceding sentence, we mirror the votes that are actually cast, rather than decide on our own how to vote. We will also “mirror vote” shares that are owned directly by us or an affiliate (excluding shares held in the separate account of an affiliated insurer). In addition, because all the shares of a given Fund held within our Separate Account are legally owned by us, we intend to vote all of such shares when that Fund seeks a vote of its shareholders. As such, all such shares will be counted towards whether there is a quorum at the Fund’s shareholder meeting and towards the ultimate outcome of the vote. Thus, under “mirror voting”, it is possible that the votes of a small percentage of contract holders who actually vote will determine the ultimate outcome. Generally, you will be asked to provide instructions for us to vote on matters such as changes in a fundamental investment strategy, adoption of a new investment advisory agreement, or matters relating to the structure of the Fund that require a vote of shareholders. We may change the way your voting instructions are calculated if it is required by federal or state regulation. We reserve the right to change the voting procedures described above if applicable federal securities laws or SEC rules change in the future.

We may, if required by state insurance regulations, disregard voting instructions if they would require shares to be voted so as to cause a change in the sub-classification or investment objectives of one or more of the available Funds or to approve or disapprove an investment advisory contract for the Fund. In addition, we may disregard voting instructions that would require changes in the investment policy or investment adviser of one or more of the Funds associated with the available Variable Investment Options, provided that we reasonably disapprove such changes in accordance with applicable federal or state regulations. If we disregard Contract Owner voting instructions, we will advise Contract Owners of our action and the reasons for such action in the next available annual or semi-annual report.

Substitution of Variable Investment Options

We may substitute one or more of the available Variable Investment Options. We may terminate the availability of any Variable Investment Option at any time. If we do so, you will no longer be permitted to allocate additional investments to the option, either by premium payment or transfer. We will not do this without any necessary SEC and/or state insurance department approvals. You will be given specific notice in advance of any substitution we intend to make.

The Fixed Rate Option

You may choose to allocate, initially or by transfer, all or part of your Contract Fund to the Fixed Rate Option. This amount becomes part of our general account. The general account consists of all assets owned by us other than those in the Account and in other separate accounts that have been or may be established by us. Subject to applicable law, we have sole discretion over the investment of the general account assets, and Contract Owners do not share in the investment experience of those assets. Instead, we guarantee that the part of the Contract Fund allocated to the Fixed Rate Option will accrue interest daily at an effective annual rate that we declare periodically, but not less than a minimum effective annual rate. The minimum effective annual rate is 1%. The fulfillment of our guarantee under this benefit is dependent on our claims paying ability. We are not obligated to credit interest at a rate higher than an effective annual rate of 1%, although we may do so.

Transfers out of the Fixed Rate Option are subject to limits. See Transfers/Restrictions on Transfers. The payment of any Cash Surrender Value attributable to the Fixed Rate Option may be delayed up to six months. See When Proceeds Are Paid.

If you exercise the Overloan Protection Rider, any remaining unloaned Contract Fund value will be transferred to the Fixed Rate Option, and transfers out of the Fixed Rate Option and into the Variable Investment Options will no longer be permitted. See Loans.

Because of exemptive and exclusionary provisions, interests in the Fixed Rate Option under the Contract have not been registered under the Securities Act of 1933 and the general account has not been registered as an investment company under the Investment Company Act of 1940. Accordingly, interests in the Fixed Rate Option are not subject to the provisions of these Acts, and we have been advised that the staff of the SEC has not reviewed the disclosure in this prospectus relating to the Fixed Rate Option. Any inaccurate or misleading disclosure regarding the Fixed Rate Option is subject to certain generally applicable provisions of federal securities laws.

CHARGES AND EXPENSES

This section provides a more detailed description of each charge that is described briefly in the SUMMARY OF CHARGES AND EXPENSES beginning on page 1 of this prospectus. There are Contract charges and Fund expenses associated with the Contract that reduce the return on your investment. These charges and expenses are described below. Most charges, although not all, are made by reducing the Contract Fund.

The total amount invested in the Contract Fund, at any time, consists of:


(a)	the Variable Investment Options,


(b)	the Fixed Rate Option, and


(c)	any Contract loan. See Loans.

When describing the Contract's charges, in several instances we use the terms "maximum charge" and "current charge." The "maximum charge", in each instance, is the highest charge that we may make under the Contract. The "current charge", in each instance, is the amount that we now charge, which may be lower than the maximum charge. If circumstances change, we reserve the right to increase each current charge, up to the maximum charge, without giving any advance notice. We will supplement this prospectus to reflect any increase in a current Contract charge, up to the maximum Contract charge, before the change is implemented.

Current charges deducted from premium payments and the Contract Fund may change from time to time, subject to maximum charges. Any changes to any of these current charges will be in consideration of one or more factors such as mortality, expenses, taxes, interest, investment experience, Contract funding, Net Amount at Risk, profit, and/or persistency, which is the length of time Contracts like this one and other contracts stay in effect. Premium - based administrative charges will be set at one rate for all Contracts like this one. Changes in other charges will be by class. We will not recoup prior losses or distribute prior gains by means of these changes.

The charges under the Contract are designed to cover, in the aggregate, our direct and indirect costs of selling, administering and providing benefits under the Contract. They are also designed, in the aggregate, to compensate us for the risks of loss we assume pursuant to the Contract. If, as we expect, the charges that we collect from the Contract exceed our total costs in connection with the Contract, we will earn a profit. Otherwise, we will incur a loss. The rates of certain of our charges have been set with reference to estimates of the amount of specific types of expenses or risks that we will incur. In most cases, this prospectus identifies such expenses or risks in the name of the charge; however, the fact that any charge bears the name of, or is designed primarily to defray a particular expense or risk does not mean that the amount we collect from that charge will never be more than the amount of such expense or risk. Nor does it mean that we may not also be compensated for such expense or risk out of any other charges we are permitted to deduct by the terms of the Contract. We may reduce stated fees under particular contracts as to which, due to economies of scale and other factors, our administrative costs are reduced.

Sales Charge on Premium

We may charge up to 6% of premiums received in all Contract Years. This charge, often called a “sales load”, is deducted to compensate us for the costs of selling the Contracts, including commissions, advertising and the printing and distribution of prospectuses and sales literature. Currently, we charge less than 6% and we only deduct the charge for premiums received in the first 10 years. This charge is made up of two rates. We apply one percentage on the amount of premium received up to the Sales Load Target Premium and a second percentage on the excess of premium received over the Sales Load Target Premium. The chart below describes the sales load as a percentage of premiums received:



	Years 1-2	Years 3-4	Years 5-6	Years 7-8	Years 9-10
Up to Sales Load Target Premium:	4%	3.5%	2.25%	1.75%	1.25%
In Excess of Sales Load Target Premium:	4%	3.5%	2.25%	1.75%	1.25%

The Sales Load Target Premium may vary from the No-Lapse Guarantee Premium, depending on the issue age and rating class of the insured, any extra risk charges, or additional riders. See PREMIUMS.

Attempting to structure the timing and amount of premium payments to reduce the potential sales load may increase the risk that your Contract will lapse without value. Delaying the payment of premium amounts to later years will adversely affect the No-Lapse Guarantee if the accumulated premium payments do not reach the No-Lapse Guarantee Values shown on your Contract Data pages. See No-Lapse Guarantee. In addition, there are circumstances where payment of premiums that are too large may cause the Contract to be characterized as a Modified Endowment Contract, which could be significantly disadvantageous. See Tax Treatment of Contract Benefits.

Premium -B ased Administrative Charge

We may charge up to 7.5% of premiums received for a premium - based administrative charge, which includes any federal, state or local income, premium, excise, or business tax or any other type of charge (or component thereof) measured by or based upon the amount of premium we receive. This charge is made up of two parts, which currently equal a total of 3.25% of the premiums received.

The first part is a charge for state and local premium taxes. The current amount for this first part is 2.5% of the premium and is our estimate of the average burden of state taxes generally. The rate applies uniformly to all Contract Owners without regard to location of residence. We may collect more for this charge than we actually pay for state and local premium taxes.

The second part is a charge for federal income taxes measured by premiums. The current amount for this second part is 0.75% of the premium. We believe that this charge is a reasonable estimate of an increase in our federal income taxes resulting from an Internal Revenue Code provision which requires us to capitalize and amortize a percentage of premiums received each year. Beginning in 2018, the required amortization period is 15 years. This charge is intended to recover this increased tax. See Company Taxes.

Surrender Charge

We assess a surrender charge if, during the first 10 Contract Years, the Contract lapses, is surrendered, or the Basic Insurance Amount is decreased (including as a result of a withdrawal or a Death Benefit type change). These surrender charges compensate us for costs associated with the Contracts, such as: processing applications, conducting examinations, determining insurability and the insured’s rating class, and establishing records. The surrender charge is a percentage of the first year’s Sales Load Target Premium, excluding premiums for riders, and is determined at the time the Contract is issued. The percentage and duration of a surrender charge vary by issue age. The surrender charge is reduced to zero by the end of the 10^th Contract Year. While the amount of the surrender charge decreases over time, it may be a substantial portion of, or even equal to, your Contract Fund.

The chart below shows maximum percentages for all ages at the beginning of the first Contract Year and the end of the last Contract Year that a surrender charge may be payable. We do not deduct a surrender charge from the Death Benefit if the insured dies during

this period. A schedule showing maximum the surrender charg e for a full surrender occurring each year that a surrender charge may be payable is found in the data pages of your Contract.



Percentages for Determining Surrender Charges
Issue Age	Percentage of Sales Load Target Premium, excluding premiums for riders , at start of year 1	Reduces to zero at the end of year
0-14	100%	10
15-48	100%	8
49-52	80%	8
53-55	80%	7
56-59	80%	5
60-62	50%	5
63-65	50%	4
66	45%	4
67 and above	45%	3

The chart below provides an example of the surrender charge applied to a representative Contract Owner. You may obtain more information about the particular surrender charge percentage that applies to you by contacting your Pruco Life of New Jersey representative.



Sample Surrender Charges Representative insured: male, age 27 at Contract issuance
Surrender occurring during Contract Year:	Percentage of first year Sales Load Target Premium, excluding premiums for riders:
1	100%
2	100%
3	100%
4	100%
5	75%
6	55%
7	30%
8	15%
9+	0

We will show a surrender charge threshold in the Contract’s data pages. This threshold amount is the lowest coverage amount since its effective date. If, during the first 10 Contract Years, the Basic Insurance Amount is decreased (including as a result of a withdrawal or a change in type of Death Benefit), and the new Basic Insurance Amount is below the threshold, we will deduct a percentage of the surrender charge. The percentage will be the amount by which the new Basic Insurance Amount is less than the threshold, divided by the Basic Insurance Amount at issue. After this transaction, the threshold will be updated and a corresponding new surrender charge schedule will also be determined to reflect that portion of the surrender charg e deducted in the past.

Cost of Insurance

We deduct a monthly cost of insurance ("COI") charge from the Contract Fund. The purpose of this charge is to compensate us for the cost of providing insurance coverage. Upon the death of the insured, the amount payable to the beneficiary (assuming there is no Contract Debt) is larger than the Contract Fund - significantly larger if the insured dies in the early years of a Contract. The COI charges collected from all Contract Owners enables us to pay this larger Death Benefit.

The COI charge (current or maximum) is determined by taking the Net Amount at Risk, divided by 1,000, and multiplying by the applicable COI rate. The COI rates vary by Contract duration, as well as the issue age, sex, and underwriting classification of the insured. The rates generally increase over time but are never more than the maximum amount listed in the Contract data pages. The maximum COI rates are based upon the 2001 Commissioner's Standard Ordinary (“CSO”) Mortality Tables. Our current COI charges range from $0.02 to $83.34 per $1,000 of Net Amount at Risk.

COI rates are applied to the Net Amount at Risk to determine the COI charge. Generally, a higher Contract Fund value in relation to the Death Benefit will result in a lower Net Amount at Risk and lower COI charge. A lower Contract Fund value in relation to the Death Benefit will result in a higher Net Amount at Risk and a higher COI charge. For Contracts with a Type A Death Benefit, the Net Amount at Risk generally changes as the Contract Fund changes. For Contracts with a Type B Death Benefit, the Net Amount at Risk generally does not change as the Contract Fund changes. For Contracts with a Type C Death Benefit, the Net Amount at Risk generally changes as the Contract Fund changes and as premium payments are made. See Types of Death Benefit.

The following table provides hypothetical examples of the Net Amount at Risk’s role in determining COI charges. The examples assume a $500,000 Basic Insurance Amount, the Death Benefit meets the definition of life insurance test, and a current monthly COI rate of $1.00 per $1,000 of Net Amount at Risk.



Example Net Amount at Risk Scenarios
Death Benefit Type	Death Benefit amount	Contract Fund value	Net Amount at Risk	Month’s COI charge
Type A	$500,000	$50,000	$450,000	$450.00
Type A	$500,000	$125,000	$375,000	$375.00
Type B	$550,000	$50,000	$500,000	$500.00
Type B	$625,000	$125,000	$500,000	$500.00
Type C*	$525,000	$50,000	$475,000	$475.00
Type C**	$575,000	$125,000	$450,000	$450.00
assumes $25,000 in total premiums paid less withdrawals. *assumes $75,000 in total premiums paid less withdrawals.

Because the Net Amount at Risk is based on your Death Benefit and your Contract Fund, it may be impacted by such factors as investment performance, charges, fees, and premium payments. Paying less premiums, paying premiums late, experiencing poor investment performance, and/or earning less interest may reduce Contract Fund value and increase the Net Amount at Risk, and may also cause the Contract to lapse earlier unless additional premiums are paid. Similarly, paying more premiums, paying premiums earlier, experiencing better market performance, and/or earning more interest may increase Contract Fund value and, in some cases, lower the Net Amount at Risk on which COI charges are based.

Administrative Charge for Basic Insurance Amount

In addition to the COI charge, each month we deduct from the Contract Fund an administrative charge for the Basic Insurance Amount. This charge is made up of two parts and is intended to compensate us for things like processing claims, keeping records, and communicating with Contract Owners.


(1)	Currently, the first part of the charge is a flat monthly fee of $30 per month in the first year and $9 per month thereafter.


(2)	The second part of the charge is an amount per $1,000 of the Basic Insurance Amount. The amount varies by issue age, sex, and underwriting classification. Generally, the per $1,000 rate is higher for older issue ages and for higher risk classifications. Currently, we apply this part of the charge during the first six Contract Years.

The following table provides examples of the initial administrative charges per $1,000 of Basic Insurance Amount.

Administrative Charge: Per $1,000 rates



Issue Age	Male Nonsmoker	Male Smoker	Female Nonsmoker	Female Smoker
35	$0.12	$0.17	$0.10	$0.13
55	$0.32	$0.39	$0.24	$0.29
75	$0.89	$1.01	$0.65	$0.87

The highest charge per thousand is $1.53 and applies to males, age 85, in the worst rating classes. The lowest charge per thousand is $0.07 and applies to age 0. The amount of the maximum charge that applies to your particular Contract is shown on the Contract’s data pages under the heading “Adjustments to the Contract Fund.”

We generally deduct the monthly charges proportionately from the dollar amount held in each of the chosen investment option(s) or you may select up to two Variable Investment Options from which we deduct your Contract's monthly charges. See Allocated Charges.

You may add one or more riders to the Contract. Some riders are charged for separately. If you add such a rider to the basic Contract, additional charges will be deducted. See Charges for Rider Coverage.

Mortality and Expense Risk Charge

Each day we deduct a charge from the assets of the Variable Investment Options in an amount equivalent to an effective annual rate of up to 0.45%. Currently, we charge 0.10%. This charge is intended to compensate us for assuming mortality and expense risks under the Contract. The mortality risk we assume is that insureds may live for shorter periods of time than we estimated when mortality

charges were determined. The expense risk we assume is that expenses incurred in issuing and administering the Contract will be greater than we estimated in fixing our administrative charges. This charge is not assessed against amounts allocated to the Fixed Rate Option.

Additional Mortality Charge for Certain Risks

We may assess an additional charge on a permanent or temporary basis for unique or specific mortality risks that exceed our standard underwriting guidelines. This additional monthly charge or "flat extra" is charged as a dollar amount per $1,000 of Basic Insurance Amount.

Generally, a permanent flat extra rating is assessed for non-medical risks such as aviation. A temporary flat extra charge is used in scenarios where mortality risk is higher in the earlier Contract Years and reduces in later years, such as may be the case for certain occupational and avocational risks and for some insureds with cancer histories. The actual dollar amounts are initially determined through the research completed for the activity or impairment during the underwriting process. The flat extra charge per $1,000 will vary based on individual circumstances of the insured, including issue age, type of risk, and the frequency of exposure to the risk.

Transaction Charges


(a)	We may charge a transfer fee of up to $25 for each transfer exceeding 12 in any Contract Year. Currently, we do not charge a transaction fee for transfers.


(b)	We may charge a withdrawal fee of up to $25 in connection with each withdrawal. Currently, we do not charge a transaction fee for withdrawals.


(c)	We may charge a Basic Insurance Amount decrease fee of up to $25 for any decrease in Basic Insurance Amount. Currently, we do not charge a transaction fee for a decrease in the Basic Insurance Amount.

Charges for Rider Coverage


•	Accidental Death Benefit Rider - We deduct a monthly charge for this rider, which provides an additional Death Benefit if the insured’s death is accidental. The current charge ranges from $0.05 to $0.28 per $1,000 of coverage based on issue age and sex of the insured, and is charged until the first Contract Anniversary on or after the insured’s 100^th birthday.

•

BenefitAccess Rider – We deduct a monthly charge for this rider, which provides an acceleration of the Death Benefit in the event the insured is Chronically Ill or Terminally Ill. The current charge ranges from $0.003 to $7.68 per $1,000 of rider Net Amount at Risk and is based on the Basic Insurance Amount and Contract duration, as well as the insured’s issue age, sex, and underwriting classification. Benefit Payments made under the Terminal Illness Option of this rider will incur a transaction charge of up to $150.

•

Children Level Term Rider - We deduct a monthly charge for this rider, which provides term life insurance on all dependent children that are covered under this rider. The current charge is $0.42 per $1,000 of coverage and is charged until the earliest of: the primary insured’s death, and the first Contract Anniversary on or after the primary insured’s 75^th birthday, or you notify us to discontinue the rider coverage. Rider charges may continue even after coverage on your last covered child has ended. If your children are no longer covered under the rider and you do not expect to have additional children who would be covered, consider discontinuing the rider.

•

Enhanced Disability Benefit Rider - We deduct a monthly charge for this rider, which provides a monthly benefit amount to the Contract Fund while the insured is totally disabled. The current charge is based on issue age, sex, and underwriting classification of the insured. The charge ranges from 7.08% to 12.17% of the monthly benefit amount and is charged until the first Contract Anniversary on or after the insured’s 60^th birthday. The monthly benefit amount is the greater of: 9% of the Contract's Limited No-Lapse Guarantee Premium (including premiums for riders and flat extras) and the total of all monthly deductions.


•	Living Needs BenefitSM Rider - We deduct a transaction fee of up to $150 if you exercise this rider, which allows you to receive an accelerated payment of the Death Benefit if the insured becomes Terminally Ill.


•	Overloan Protection Rider - We deduct a transaction fee of 3.5% of your Contract Fund amount if you exercise this rider, which may guarantee protection against lapse due to Contract Debt.

Net Interest on Loans

Interest charged on a loan accrues daily. We charge interest on the full loan amount, including all unpaid interest. Interest is due on the earlier of each Contract Anniversary or when the loan is paid back. The net interest on loans reflects the net difference between the interest rates charged and credited. A standard loan has an effective annual interest rate of 2%. A preferred loan has an effective annual interest rate of 1.05%. All loans have an effective annual interest credit equal to 1%. See Loans.

Fund Expenses

As described in each Fund's prospectus, fees are deducted from and expenses are paid out of the assets in the Fund. Fund prospectuses are available at www.prudential.com/eprospectus or by calling 800-944-8786. If a change in a Fund's expenses increases the maximum Total Annual Fund Operating Expenses, as presented under SUMMARY OF CHARGES AND EXPENSES, we will supplement this prospectus upon notification of this change from the Fund.

Allocated Charges

You may select up to two Variable Investment Options from which we deduct your Contract's monthly charges. Monthly charges include: (1) COI charge, (2) administrative charge for Basic Insurance Amount, (3) any monthly rider charges, and (4) any additional mortality charge for extra risk classification. Allocations must be designated in whole percentages and total 100%. For example, 33% can be selected but 33⅓% cannot. The Fixed Rate Option is not available as one of your allocation options.

If there are insufficient funds in one or both of your selected Variable Investment Options to cover the monthly charges, the selected Variable Investment Option(s) will be reduced to zero. Any remaining charge will generally be deducted from your other Variable Investment Options and the Fixed Rate Option in proportion to the dollar amount in each. Furthermore, if you do not specify an allocation of monthly charges, we will generally deduct monthly charges proportionately from all your Variable Investment Options and the Fixed Rate Option.

Charges After Age 121

Beginning on the first Contract Anniversary on or after the insured’s 121^stbirthday, we will no longer accept premiums or deduct monthly charges from the Contract Fund. You may continue the Contract until the insured's death, or until you surrender the Contract for its Cash Surrender Value. You may continue to make transfers, loans and withdrawals, subject to the limitations on these transactions described elsewhere in this prospectus. We will continue to make daily deductions for mortality and expense risk charges, and the Funds will continue to charge operating expenses if you have amounts in the Variable Investment Options. Any Contract loan will remain outstanding and continue to accrue interest until it is repaid.

PERSONS HAVING RIGHTS UNDER THE CONTRACT

Contract Owner

There are circumstances when the Contract Owner is not the insured. There may also be more than one Contract Owner. If the Contract Owner is not the insured or there is more than one Contract Owner, they will be named in an endorsement to the Contract. This ownership arrangement will remain in effect unless you ask us to change it.

You may change the ownership of the Contract by sending us a request. We may ask you to send us the Contract to be endorsed. Once we receive your request, and the Contract if we ask for it, we will file and record the change, and it will take effect as of the date the request is received in Good Order at our Service Office.

While the insured is living, the Contract Owner is entitled to any Contract benefit and value. Only the Contract Owner is entitled to exercise any right and privilege granted by the Contract or granted by us. For example, the Contract Owner is generally entitled to surrender the Contract, access Contract values through loans or withdrawals, assign the Contract, and to name or change the beneficiary.

Beneficiary

The beneficiary is entitled to receive any benefit payable on the death of the insured. You may designate or change a beneficiary by sending us a request. We may ask you to send us the Contract to be endorsed. Once we receive your request in Good Order at our Service Office, and the Contract if we ask for it, we will file and record the change and it will take effect as of the date you sign the request. However, if we make any payment(s) before we receive the request, we will not have to make the payment(s) again. When we are made aware of an assignment, we will recognize the assignee’s rights before any claim payments are made to the beneficiary. When a beneficiary is designated, any relationship shown is to the insured, unless otherwise stated.

OTHER GENERAL CONTRACT PROVISIONS

Assignment

This Contract may not be assigned if the assignment would violate any federal, state or local law or regulation prohibiting sex distinct rates for insurance. Generally, the Contract may not be assigned to an employee benefit plan or program without our consent. We assume no responsibility for the validity or sufficiency of any assignment. We will not be obligated to comply with any assignment unless we receive a copy at a Service Office.

Incontestability

We will not contest the Contract after it has been in f orce during the insured’s lifetime for two years from the issue date, the reinstatement date, or the effective date of any change made to the Contract that requires our approval and would increase our liability.

Misstatement of Age or Sex

If the insured's stated age or sex or both are incorrect in the Contract, we will adjust the Death Benefit payable and any amount to be paid, as required by law, to reflect the correct age and sex. Any such benefit will be based on what the most recent deductions from the Contract Fund would have provided at the insured's correct age and sex. Adjustments to the Death Benefit for misstatements of age or sex are not restricted to the incontestability provision described above.

Settlement Options

The Contract grants to most Contract Owners, or to the beneficiary, a variety of optional ways of receiving Contract proceeds. Under the Contract, the Death Benefit may be paid in a single sum or under one of the optional modes of settlement. Any Pruco Life of New Jersey representative authorized to sell this Contract can explain these options upon request.

Suicide Exclusion

Generally, if the insured dies by suicide within two years from the Contract Date, the Contract will end and we will return the premiums paid, less any Contract Debt, and less any withdrawals.

RIDERS

Contract Owners may be able to obtain extra fixed benefits, which may require additional charges. These optional insurance benefits will be described in what is known as a "rider" to the Contract. All riders are only available at Contract issuance, except as noted. The available riders include the following (as described more fully below):


•	BenefitAccess Rider, which provides for an acceleration of the Death Benefit if the insured becomes Chronically Ill or Terminally Ill.


•	Accidential Death Benefit Rider, which provides an additional Death Benefit that is payable if the insured's death is accidental.


•	Children Level Term Rider, which provides term life insurance coverage on the life of the insured's covered children.


•	Enhanced Disability Benefit Rider, which pays a monthly benefit amount into the Contract if the insured is totally disabled.


•	Living Needs Benefit^SM Rider, which allows you to elect to receive an accelerated payment of all or part of the Death Benefit, adjusted to reflect current value, if the insured becomes Terminally Ill. This rider may be added after Contract issuance, subject to our underwriting requirements.


•	Overloan Protection Rider, which if exercised, guarantees protection against lapse due to loans, even if the Contract Debt exceeds the accumulated Cash Surrender Value of your Contract.

Charges applicable to the riders will be deducted from the Contract Fund on each Monthly Date, with the exception of the Living Needs Benefit^SM Rider, the Overloan Protection Rider, and the Terminal Illness Option of the BenefitAccess Rider.

We will not pay a benefit under the Accidental Death Benefit rider or make payments under the Enhanced Disability Benefit Rider for any death or injury that is caused or contributed to by war or act of war, declared or undeclared, including resistance to armed aggression. This restriction includes service in the armed forces of any country at war.

Some riders may depend on the performance of the Contract Fund. Rider benefits will no longer be available if the Contract lapses, or if you choose to keep the Contract in force under the Overloan Protection Rider. Some riders are not available in conjunction with other riders and certain restrictions may apply as set forth below. A Pruco Life of New Jersey representative can explain all of these extra benefits further. We will provide samples of the provisions upon receiving a written request.

BenefitAccess Rider

The BenefitAccess Rider provides for the acceleration of the Death Benefit in the event the insured is Chronically Ill, subject to certain eligibility requirements, and approval of the claim (“Chronic Illness Option”). This rider will also provide acceleration of the Death Benefit if the insured becomes Terminally Ill, subject to certain eligibility requirements and approval of the claim (“Terminal Illness Option”). This rider is only available at Contract issuance and there is a charge for this rider. You may terminate this rider at anytime. This rider is not available on Contracts that include the Enhanced Disability Benefit Rider or the Living Needs Benefit^SM Rider.

Exercise of an accelerated Death Benefit option under this rider will cause a reduction in, or elimination of, the Contract’s Death Benefit, cash value, and loan value as described below under Impact of Rider Benefits on Contract and Riders. Premiums or charges needed to keep the Contract in force will also be reduced based on the reduced Death Benefit. There may be adverse tax consequences in the event you accelerate the Death Benefit. See Tax Treatment of Contract Benefits – BenefitAccess Rider.

This rider should be purchased for the purpose of providing Chronic Illness and Terminal Illness coverage. For Terminal Illness coverage only, consider the Living Needs Benefit^SM Rider below.

Conditions for Eligibility of Benefit Payments:

Terminal Illness Option

You are eligible to receive an accelerated benefit under this option subject to the following conditions:


(a)	The Contract must be in force and the insured must be living;


(b)	You must submit a claim in a form that meets our needs;


(c)	We must receive Written Certification by a Licensed Health Care Practitioner that the insured has a life expectancy of six months or less;


(d)	You must provide the consent, in writing, of any assignee and irrevocable beneficiary(ies) on the Contract;


(e)	You must send us the Contract if we ask for it; and


(f)	We reserve the right to set a minimum of no more than $50,000 on the amount of the Death Benefit you may exercise under this option.

Chronic Illness Option

You are eligible to receive an accelerated benefit under this option subject to the following conditions:


(a)	The Contract must be in force and the insured must be living;


(b)	You must submit a claim in a form that meets our needs;


(c)	We must receive Written Certification by a Licensed Health Care Practitioner, prior to the start of every Benefit Year, that the insured is Chronically Ill and not expected to recover during his or her lifetime;


(d)	We must receive authorization from the insured to obtain copies of any relevant medical records that we require;


(e)	You must not have received a Benefit Payment under the Terminal Illness Option; and


(f)	You must provide the consent, in writing, of any assignee and irrevocable beneficiary(ies) on the Contract.

We reserve the right to complete, at our discretion and expense, a personal interview with and an assessment of the insured, which may include examination or tests by a Licensed Health Care Practitioner of our choice, while a claim is pending or during a Benefit Period, to ensure that the insured is Chronically Ill. If there is a difference in opinion between the insured’s Licensed Health Care

Practitioner and ours, eligibility will be determined by a third medical opinion provided by a Licensed Health Care Practitioner who is mutually agreed upon by the insured and us.

Prior to the end of each Benefit Year, we will send you a request for Recertification, which must be completed and returned to us prior to the start of the next Benefit Year to satisfy us that the insured continues to be eligible for Benefit Payment. You will be notified if you continue to be eligible for Benefit Payments. If we do not receive Recertification prior to the end of the Benefit Year, any subsequent benefits will be treated as a new claim.

Benefit Payments:

Terminal Illness Option

You have the option to accelerate all or a partial amount of the Death Benefit. If you accelerate a partial amount, the remaining Death Benefit must be no less than $25,000, and you may only make one additional acceleration, which must be for the full Death Benefit. The only payment option is a single lump sum Benefit Payment which will be determined based on the following factors: (1) the amount of the Death Benefit; (2) the insured’s reduced life expectancy; and (3) an interest rate no greater than the greater of (a) the yield on 90-day Federal Treasury bills at the time the benefit is accelerated, and (b) the maximum statutory policy loan interest rate at the time the benefit is accelerated. Payment will be made subject to the conditions of eligibility described above and after we have approved the claim.

If you accelerate a Death Benefit under this option, you will no longer be eligible for the Chronic Illness Option and any Benefit Payments you may be receiving under that option will end.

If there is an outstanding loan on the Contract, a portion of each Benefit Payment will be used to reduce the loan in the same proportion as the reduction in the Death Benefit . If the Contract is in default but not past the grace period at the time of claim, the B enefit P ayment will be reduced by the amount needed to bring the Contract out of default. See Contract Lapse.

See below for an example of an accelerated Benefit Payment under the Terminal Illness Option.

Chronic Illness Option

The maximum amount of your life insurance that can be accelerated is the Lifetime Benefit Amount, which is equal to the Contract’s Death Benefit. The maximum Lifetime Benefit Amount will be determined at the time you make the initial claim. The Lifetime Benefit Amount will be reduced by any transactions you make that reduce the Death Benefit of the Contract.

You have the option to receive your Benefit Payments monthly or annually and payments will begin no later than the Monthly Date on or following the date the claim is approved.

If you choose to receive monthly Benefit Payments, the Maximum Monthly Benefit Payment for that year will be calculated at the beginning of each Benefit Year and recalculated at the beginning of each subsequent Benefit Year. Subject to a minimum payment of $500, you have the option to receive less than the Maximum Monthly Benefit Payment amount, but the amount may not be changed during the Benefit Year. An amount that is less than the maximum may extend your payment period.

When we determine the Maximum Monthly Benefit Payment amount each Benefit Year, we use the per diem limitation (maximum daily amount allowed) declared by the Internal Revenue Service ("IRS") and the Lifetime Benefit Amount. The Maximum Monthly Benefit Payment is equal to the lowest of:


(a)	The Lifetime Benefit Amount multiplied by the Monthly Benefit Percent;


(b)	The per diem limitation in effect at the start date of the current benefit year times 30; and


(c)	The Initial Daily Benefit Limit compounded annually on each anniversary at the Daily Benefit Limit Compound Rate times 30.

If you choose to receive your Benefit Payments on an annual basis, the annual Benefit Payment will equal the sum of the present value of each Maximum Monthly Benefit Payment for the Benefit Year. The discount factor used to determine the present value will be the one in effect on the Benefit Year start date and will not exceed the greater of (1) the current yield on 90-day federal treasury bills, or (2) the current maximum statutory adjustable contract loan interest rate.

When you receive monthly Benefit Payments the remaining amount that can be accelerated will be reduced each month by the amount of the monthly Benefit Payment chosen. An annual Benefit Payment will reduce the remaining amount by twelve times the Maximum Monthly Benefit Payment amount for that Benefit Year.

If there is an outstanding loan on the Contract, a portion of each Benefit Payment will be used to reduce the loan.

If the Contract is in default but not past the grace period at the time of claim, the first Benefit Payment will be reduced by the amount needed to bring the Contract out of default (see Contract Lapse). If the amount needed to bring the Contract out of default is more than the amount of the first Benefit Payment net of the amount allocated to reduce any Contract loan, the first Benefit Payment will be increased to an amount that will bring the Contract out of default.

See below for an example of accelerated Benefit Payments under the Chronic Illness Option.

When Benefit Payments End:

Chronic Illness Option (only)

Benefit Payments will continue to be made until the earliest of the following dates: (1) the date we receive written notification that you wish to discontinue Benefit Payments; (2) the date the insured no longer meets the eligibility requirements, including

Recertification; (3) the date the Lifetime Benefit Amount is exhausted; (4) the date a claim is approved under the Terminal Illness Option; or (5) the date the rider terminates.

If you request that we discontinue Benefit Payments, you will have the option to resume payments at a later date, if you meet all eligibility requirements.

Impact of Rider Benefits on Contract and Riders:

Accelerating the Death Benefit will impact the benefits and values under the Contract and rider as shown below.

Terminal Illness Option

A one-time acceleration of a partial amount of the Death Benefit results in the following:


(1)	A proportionate reduction in the Basic Insurance Amount, Contract Fund, surrender charge, and Contract Debt.


(2)	Premiums or charges to keep the Contract in force will be recalculated based on the insured’s age and the reduced Death Benefit amount.


(3)	If your Contract includes the Rider To Provide Lapse Protection or the Rider for Level Term Insurance Benefit on Dependent Children (Children Level Term Rider) , these riders will stay in effect.


(4)	Any Accidental Death Benefit Rider on the Contract will not be affected.


(5)	The monthly charge for this rider will be permanently waived.

Acceleration of the full death benefit results in the following:


(1)	The Contract and all benefits under the Contract based on the insured’s life, including any Accidental Death Benefit Rider, will end.


(2)	If your Contract includes the Rider for Level Term Insurance Benefit on Dependent Children, it will become paid up.



Example: Shown below is an example of how an accelerated benefit under the Terminal Illness Option will impact the Contract. The figures used are for illustrative purposes only and are not guaranteed.
Contract Information
Sex and issue age:	Male 35	Underwriting Classification:	Preferred Best
Contract Date:	12/20/2013	Basic Insurance Amount:	$200,000
Claim Date:	12/21/2013	Death Benefit Option:	Type A (fixed)
	Contract values as of 12/20/2023 (before acceleration of Death Benefit):	Contract values as of 12/20/2023 (after acceleration of Death Benefit)*:
		100% of Death Benefit	50% of Death Benefit
Benefit Payment payable:	- - -	$191,260	$95,555
Basic Insurance Amount:	$200.000	$0	$100,000
Loan balance:	$1,040	$0	$520
Death Benefit:	$198,960	$0	$99,480
Contract Fund:	$12,200	$0	$6,100
Surrender Charge:	$860	$0	$430
Cash value:	$11,340	$0	$5,670
Cash Surrender Value:	$10,300	$0	$5,150
Annual Premium:	$1,588	$0	$857
*A six-month discount at an annual rate of 8% has been applied for early payment, along with a transaction charge of $150

Chronic Illness Option

Following each Benefit Payment while there is a Death Benefit remaining, benefits and values under the Contract and rider will be impacted as follows:


(1)	The Contract will remain in force in accordance with Contract terms.


(2)	A proportionate reduction will be made (using the reduction factor below) in the Basic Insurance Amount, Contract Fund, surrender charg e, and any outstanding Contract Debt.


(3)	Any Accidental Death Benefit Rider on the contract will not be affected.


(4)	If your Contract includes the Rider To Provide Lapse Protection or the Rider for Level Term Insurance Benefit on Dependent Children (Children Level Term Rider) , these riders will stay in effect.


(5)	While you are receiving Benefit Payments, you may not take a withdrawal or decrease the Contract’s Basic Insurance Amount.


(6)	You may continue to make premium payments but it is not necessary while you are receiving benefits.


(7)	The monthly charge for this rider will be permanently waived following approval of the initial claim.


(8)	While you are receiving Benefit Payments, all monthly charges deducted from the Contract Fund will be waived. Monthly charges will be waived until you notify us to discontinue Benefit Payments, the insured fails to recertify, or this rider

terminates. Once you have received 25 monthly Benefit Payments or the annual equivalent, all monthly charges for the Contract will be permanently waived as long as this rider is in effect.

Reduction factor = 1 − (A / B)

Where: A = is the gross monthly Chronic Illness Option Benefit Payment, and

B = is the Death Benefit immediately prior to the Benefit Payment.



Example: Shown below is an example of an accelerated benefit under the Chronic Illness Option and how the accelerated benefit will impact the Contract. The figures used are for illustrative purposes only and are not guaranteed.
Contract Information
Sex and issue age:	Male 35	Underwriting Classification:	Preferred Best
Contract Date:	7/4/2013	Basic Insurance Amount:	$500,000
Claim Date:	10/4/2016	Death Benefit Option:	Type A (fixed)

Lifetime Benefit Amount is equal to the Death Benefit at the time of initial claim.

Maximum Monthly Benefit Payment, calculated at the beginning of each Benefit Year using the IRS per diem limitation and your Lifetime Benefit Amount, is equal to the lowest of:

(a) The Lifetime Benefit Amount multiplied by the Monthly Benefit Percent (2%): $500,000 x 0.02 = $10,000; or
(b) Per diem limitation (a maximum allowable amount declared annually by the IRS for chronic illness payments under section 7702B) in effect at the start date of the current benefit year times 30 (Example: $320 x 30 = $9,600); or
(c) Initial Daily Benefit Limit (which is the per diem limitation in effect on the contract date) compounded annually on each anniversary at the Daily Benefit Limit Compound Rate times 30. This limit on the Contract Date was $320, increased annually on each succeeding Contract Anniversary by the Daily Benefit Limit Compound Rate, resulting in a current daily benefit limit in Contract year 4 of $359.96: $359.96 x 30 = $10,798.80.

The Monthly Benefit Percent, Initial Daily Benefit Limit and the Daily Benefit Limit Compound Rate vary based upon the characteristics of the insured and can be found in the Contract.

The reduction factor equals 1 minus the quotient of the gross Chronic Illness Benefit Payment divided by the Death Benefit prior to payment: 1 - (9,600/500,000) = 1 - 0.0192 = 0.9808

The Chronic Illness Benefit payable is equal to the Maximum Monthly Benefit Payment minus the loan amount. ($9,600 - $20 = $9,580)

	Contract values as of 10/04/2016 (before acceleration of Death Benefit):	Contract values as of 10/04/2016 (after acceleration of Death Benefit)*:
Benefit Payment payable:	- - -	$9,580
Basic Insurance Amount:	$500,000	$490,400 (500,000x0.9808)
Loan balance:	$1,040	$1,020 (1,040x0.9808)
Death Benefit:	$498,960	$489,380
Contract Fund:	$20,000	$19,616 (20,000x0.9808)
Surrender Charge:	$3,350	$3,286 (3,350x0.9808)
Cash value:	$16,650	$16,330
Cash Surrender Value:	$15,610	$15,310
Annual Premium:	$3,816	$3,738

If the Contract to which this rider is attached has a Type A Death Benefit, when this option is exercised, the Basic Insurance Amount will be changed to equal the Type A Death Benefit. If the Contract to which this rider is attached has a Type B or Type C Death Benefit, when this option is exercised, the Death Benefit will be changed to a Type A Death Benefit and the Basic Insurance Amount will be changed to equal the Type A Death Benefit. Once you have exercised the Chronic Illness Option, the Contract’s Death Benefit type must remain Type A.

When you submit a claim under the Chronic Illness Option, you must authorize a transfer of all Contract value from the Variable Investment Options to the Fixed Rate Option. You will not receive Benefit Payments if you do not transfer all Contract value from the Variable Investment Options to the Fixed Rate Option and all Contract value must remain in the Fixed Rate Option. Additional premium payments or loan repayments must also be allocated to the Fixed Rate Option while your claim is reviewed and while you are receiving Benefit Payments. Fund transfers, dollar cost averaging, and automatic rebalancing will not be allowed.

When the rider is terminated, if Benefit Payments are discontinued, or the Benefit Access Rider claim is not approved, your Contract may still be in f orce and Contract value will remain in the Fixed Rate Option. You may transfer funds from the Fixed Rate Option to your choice of Variable Investment Options. Your first transfer from the Fixed Rate Option will not be subject to the Fixed Rate Option restrictions described in the section titled Transfers/Restrictions on Transfers. You may also allocate new premium payments

and loan repayments to the Variable Investment Options of your choice. You must notify us if you wish to resume allocations to the Variable Investment Options or change your premium allocation.

After an acceleration of the Lifetime Benefit Amount, any Rider for Level Term Insurance Benefit on Dependent Children will become paid up and any benefits under the Contract based on the insured’s life, including any Accidental Death Benefit Rider will end.

Rider Termination:

This rider terminates on the earliest of: when you request that we remove it, the grace period ends if the Contract is in default, the insured dies, or this rider or Contract ends for any other reason. When this rider is terminated, or you request that we stop Benefit Payments after a claim has been made, the Contract may still be in force. The Death Benefit and Contract Fund values will have been reduced as a result of any payments made prior to the date we stop payments or this rider terminates.

Accidental Death Benefit Rider

The Accidental Death Benefit Rider provides an additional Death Benefit that is payable if the insured's death is accidental, as defined in the benefit provision. A death resulting from injury must occur no more than 90 days after the injury. This benefit will end on the earliest of: the end of the day before the first Contract Anniversary on or after the insured’s 100^th birthday and the first Monthly Date on or after the date a request to discontinue the rider is received in Good Order at a Service Office. This rider is not available on Contracts that have the Overloan Protection Rider.

Children Level Term Rider

The Children Level Term Rider provides term life insurance coverage on the life of the insured's dependent children, as defined in the benefit provision. The rider coverage will end on the earliest of: (1) the end of the day before the first Contract Anniversary on or after the primary insured’s 75^thbirthday, (2) the end of the day before the first Contract Anniversary on or after the child’s 25^th birthday, (3) the end of the day before the date a rider is converted to a new Contract, and (4) the first Monthly Date on or after the date a request to discontinue the rider is received in Good Order at a Service Office.

Enhanced Disability Benefit Rider

The Enhanced Disability Benefit Rider pays a monthly benefit amount into the Contract if the insured is totally disabled, as defined in the benefit provision. The rider coverage will end as of the first Contract Anniversary on or after the insured’s 60^th birthday. This rider is not available on Contracts with a Type C Death Benefit. or with Contracts that include the BenefitAccess Rider.

Living Needs Benefit^SM Rider

The Living Needs Benefit^SM Rider may be available on your Contract. There is no charge for adding the benefit to a Contract. However, when a claim is paid under this rider, a reduction for early payment is applied and a processing fee of up to $150 per Contract will be deducted. The Living Needs Benefit^SM Rider is not available with Contracts that include the BenefitAccess Rider.

The Living Needs Benefit^SM allows you to elect to receive an accelerated payment of all or part of the Contract's Death Benefit, adjusted to reflect current value, at a time when certain special needs exist. The adjusted Death Benefit will always be less than the Death Benefit, but will not be less than the Contract’s Cash Surrender Value.

All or part of the Contract's Death Benefit may be accelerated. If the benefit is only partially accelerated, a Death Benefit of at least $25,000 must remain under the Contract. The minimum amount that may be accelerated for a Living Needs Benefit^SM claim is $50,000. However, we currently have an administrative practice to allow a reduced minimum of $25,000. We reserve the right to discontinue this administrative practice in a non-discriminatory manner and we will notify you prior to discontinuing this practice.

The Terminal Illness Option is available on the Living Needs Benefit^SM Rider when a licensed physician certifies the insured as terminally ill with a life expectancy of six months or less. When that evidence is provided and confirmed by us, we will provide an accelerated payment of the portion of the Death Benefit selected by the Contract Owner as a Living Needs Benefit^SM. The Contract Owner will receive this benefit in a single sum. No benefit will be payable if you are required to elect it in order to meet the claims of creditors or to obtain a government benefit. We can furnish details about the amount of Living Needs Benefit^SM that is available to an eligible Contract Owner, and the effect on the Contract if less than the entire Death Benefit is accelerated.

You should consider whether adding this settlement option is appropriate in your given situation. Adding the Living Needs Benefit^SM to the Contract has no adverse consequences; however, electing to use it could. With the exception of certain business-related Contracts, the Living Needs Benefit^SM is excluded from income if the insured is terminally ill or chronically ill as defined in any applicable tax law (although the exclusion in the latter case may be limited). You should consult a tax adviser before electing to receive this benefit. Receipt of a Living Needs Benefit^SM payment may also affect your eligibility for certain government benefits or entitlements.

Overloan Protection Rider

The Overloan Protection Rider, if exercised, guarantees protection against lapse due to loans, even if the Contract Debt exceeds the accumulated Cash Surrender Value of your Contract. Currently, the rider may be added only at the time your Contract is issued; however, this rider is not available on Contracts that have the Accidental Death Benefit Rider. There is no charge for adding the Overloan Protection Rider to your Contract, however, a one-time fee will apply when this rider is exercised.

The following eligibility requirements must be met to exercise the rider:


(a)	We must receive a written request in Good Order to exercise the rider benefits;


(b)	Contract Debt must exceed the Basic Insurance Amount


(c)	The Contract must be i n f orce for the later of 15 years and the Contract Anniversary after the insured’s 75^th birthday;


(d)	The Guideline Premium Test must be used as the Contract’s definition of life insurance;


(e)	Contract Debt must be a minimum of 95% of the cash value^;


(f)	The Cash Surrender Value must be sufficient to pay the cost of exercising the rider; and


(g)	Your Contract must not be classified as a Modified Endowment Contract and must not qualify as a Modified Endowment Contract as a result of exercising this rider.

We will send you a notification upon your becoming eligible for this benefit. We deduct a transaction fee of 3.5% of your Contract Fund amount if you exercise this rider..

When you exercise the rider, the effective date will be the next date that monthly charges are deducted following our receipt of your request in Good Order at a Service Office. Decreases to your Basic Insurance Amount, rating reductions, and withdrawals will no longer be permitted. The charges and benefits of other riders available under your Contract will be discontinued, except for the Living Needs Benefit^SM Rider. Any benefits you may currently be receiving under the Enhanced Disability Benefit Rider will also be discontinued.

Any unloaned Contract Fund value remaining in the Variable Investment Options will be transferred to the Fixed Rate Option. Additionally, fund transfers into any of the Variable Investment Options will no longer be permitted. Any auto-rebalancing, dollar cost averaging, allocated charges, or premium allocation instructions will be discontinued.

Premium payments will no longer be accepted for the Contract. Instead, all payments received will be applied as loan or loan interest repayments. We will no longer send any regularly scheduled bills, and electronic fund transfer of premium payments will be cancelled.

If you have a Type B Death Benefit, we will change it to a Type A Death Benefit. You will no longer be permitted to make Death Benefit changes as long as your Contract remains i n force under the Overloan Protection Rider. The Basic Insurance Amount will be set equal to the Death Benefit at the time the rider is exercised. From that point onward, the Death Benefit will be the greater of the Type A Death Benefit and the amount of the Contract Debt multiplied by the Attained Age factor that applies. The Attained Age factors are shown in your Contract. For an explanation of the Attained Age factors, see Tax Treatment of Contract Benefits - Treatment as Life Insurance.

Please note that the IRS may take a position that the outstanding loan balance should be treated as a distribution when the Contract Owner elects the Overloan Protection Rider benefit. Distributions are subject to income tax. Were the IRS to take this position, we would take reasonable steps to attempt to avoid this result, including modifying the Contract's loan provisions, but cannot guarantee that such efforts would be successful. You should consult a tax adviser as to the tax risks associated with exercising the Overloan Protection Rider.

REQUIREMENTS FOR ISSUANCE OF A CONTRACT

Generally, the Contract may be issued on insureds through age 85 for Contracts with Type A (fixed) and Type B (variable) Death Benefits, and through age 70 for Contracts with Type C (return of premium) Death Benefit. Currently, the minimum Basic Insurance Amount is $75,000 ($50,000 for insureds below the issue age of 18, $100,000 for insureds issue ages 76-80, and $250,000 for insureds issue ages 81 and above). The minimum Basic Insurance Amount for Contracts issued with a Type C (return of premium) Death Benefit is $250,000. See Types of Death Benefit.

We require evidence of insurability, which may include a medical examination, before issuing any Contract. Preferred Best nonsmokers are offered more favorable cost of insurance rates than smokers. We charge a higher cost of insurance rate and/or an extra amount if an additional mortality risk is involved. We will not allow a change to your Contract if it will cause the Death Benefit to exceed our retention limits or violate any other underwriting rule. These are the current underwriting requirements. We reserve the right to change them on a non‑discriminatory basis.

Contract Date

There is no insurance under this Contract until the minimum initial premium is paid. If a medical examination is required, the Contract Date will ordinarily be the date the examination is completed. Under certain circumstances, we may allow the Contract to be backdated up to six months prior to the application date for the purpose of lowering the insured's issue age. This may be advantageous for some Contract Owners as a lower issue age may result in lower current charges.

PREMIUMS

Minimum Initial Premium

The Contract offers flexibility in paying premiums. The minimum initial premium is due on or before the Contract Date. It is the premium needed to start the Contract. The minimum initial premium is equal to 9% of the Limited No-Lapse Guarantee Premium, including all extras and additional premiums for optional riders and benefits, for Contracts with Type A (fixed) and Type B (variable) Death Benefits. The minimum initial premium is equal to 9% of the Short Term No-Lapse Guarantee Premium for Contracts with Type C (return of premium) Death Benefit. There is no insurance under the Contract unless at least the minimum initial premium is paid. Thereafter, you decide when to make premium payments and, subject to a $25 minimum, in what amounts.

We may require an additional premium if deductions from the premium payments and any Contract Fund charges due on or before the payment date exceed the minimum initial premium. We reserve the right to refuse to accept any payment that would require us to increase the Death Benefit (under Section 7702 of the Internal Revenue Code) by more than the payment increases the Contract Fund. Furthermore, there are circumstances under which the payment of premiums in amounts that are too large may cause the Contract to be characterized as a Modified Endowment Contract, which could be significantly disadvantageous. If you make a payment that would cause the Contract to be characterized as a Modified Endowment Contract, we will send you a letter to advise you of your options. Generally, you have 60 days from when we received your payment to remove the excess premiums and any accrued interest. If you

choose not to remove the excess premium and accrued interest, your Contract will become permanently characterized as a Modified Endowment Contract. We will not accept a premium payment that exceeds the Guideline Premium limit if your Contract uses the Guideline Premium definition of life insurance. See Tax Treatment of Contract Benefits.

Generally, the net amount of the minimum initial premium will be placed in the Contract Fund as of the Contract Date. If we do not receive your initial premium on or before the Contract Date, we apply the initial premium to your Contract as of the end of the Valuation Period in which it is received in Good Order at the Payment Office. See Allocation of Premiums. In no case will the premium be applied with an effective date that precedes the date of this offering.

Available Types of Premium

After the minimum initial premium is paid, no other specific premiums are required and you have a certain amount of flexibility with respect to the amount and timing for future premium payments. Two possible patterns of premiums are described below. Contracts with no riders or extra risk charges will have level premiums for the premium types described below. Understanding them may help you understand how the Contract works.

•

Short Term No-Lapse Guarantee Premiums are premiums that, if paid as described in the No-Lapse Guarantee section, will keep the Contract in f orce during the Short Term No-Lapse Guarantee period regardless of investment performance and assuming no loans, withdrawals, or Contract changes. All Contracts offer a Short Term No-Lapse Guarantee period. If you choose to continue a No-Lapse Guarantee beyond this period, you will have to begin paying premiums higher than the Short Term No-Lapse Guarantee Premium. Contracts with Type C Death Benefit do not offer a guarantee beyond the Short Term No-Lapse Guarantee period.


•	Limited No-Lapse Guarantee Premiums are premiums that, if paid as described in the No-Lapse Guarantee section, will keep the Contract in f orce during the Limited No-Lapse Guarantee period regardless of investment performance and assuming no loans, withdrawals, or Contract changes. Contracts with Type C Death Benefit do not offer the No-Lapse Guarantee for this period.

The No-Lapse Guarantee periods are described under No-Lapse Guarantee. The length of the No-Lapse Guarantee depends on the Contract's initial Death Benefit type. See No-Lapse Guarantee. When you purchase a Contract, your Pruco Life of New Jersey representative can tell you the Short Term No-Lapse Guarantee and Limited No-Lapse Guarantee Premium amounts.

We can bill you for the amount you select annually, semi-annually, or quarterly. Because the Contract is a flexible premium Contract, there are no scheduled premium due dates. When you receive a premium notice, you are not required to pay this amount. The Contract will remain in force if: (1) the Contract Fund, less any applicable surrender charg e, is greater than zero and more than any Contract Debt or (2) you have paid sufficient premiums, as described in the No-Lapse Guarantee section, to meet the No-Lapse Guarantee conditions and Contract Debt is not equal to or greater than the Contract Fund, less any applicable surrender charg e. You may also pay premiums automatically through pre-authorized monthly electronic fund transfers from a bank checking account. If you elect to use this feature, you choose the day of the month on which premiums will be paid and the premium amount. We will then draft the same amount from your account on the same date each month. When you apply for the Contract, you and your Pruco Life of New Jersey representative should discuss how frequently you would like to be billed (if at all) and for what amount.

Allocation of Premiums

On the later of the Contract Date and the end of the Valuation Period in which the initial premium is received, we deduct the sales charge and the premium - based administrative charge from the initial premium. During the 10-day period following your receipt of the Contract, the remainder of the initial premium and any other net premium will be allocated to the money market investment option as of the end of the Valuation Period in which it is received in Good Order at the Payment Office. The first monthly deductions are made after the remainder of the initial premium and any other net premium is allocated to the money market investment option. After the tenth day, these funds, adjusted for any investment results, will be transferred out of the money market investment option and allocated according to your current premium allocation. The transfer from the money market investment option on the tenth day following receipt of the Contract will not be counted as one of your 12 free transfers per Contract Year or the 20 transfers per calendar year described under Transfers/Restrictions on Transfers. If the first premium is received before the Contract Date, there will be a period during which the Contract Owner's initial premium will not be invested.

The sales charge and the premium - based administrative charge will also apply to all subsequent premium payments. The remainder of each subsequent premium payment will be invested as of the end of the Valuation Period in which it is received in Good Order at the Payment Office, in accordance with the applicable allocation instructions. The “Valuation Period” means the period of time from one determination of the value of the amount invested in a Variable Investment Option to the next. Such determinations are made when the net asset values of the Variable Investment Options are calculated, which is as of the close of regular trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time). With respect to any initial premium payment received before the contract date and any premium payment that is not in Good Order, we may temporarily hold the premium in a suspense account and we may earn interest on such amount. You will not be credited interest on those amounts during that period. The monies held in the suspense account may be subject to claims of our general creditors. The premium payment will not be reduced nor increased due to market fluctuations during that period.

Provided the Contract is neither in default nor in force under the provisions of the Overloan Protection Rider or the terms of the BenefitAcess Rider, you may change the way in which subsequent premiums are allocated by providing your request to us in Good Order at a Service Office. Allocation changes may generally be made by mail, phone, fax, or website. Contracts that are jointly owned or assigned generally cannot change premium allocations by phone, fax, or website. See Assignment. There is no charge for reallocating future premiums. All percentage allocations must be in whole numbers. For example, 33% can be selected but 33⅓% cannot. The total allocation to all selected investment options must equal 100%.

Payments, Contract value must remain in the Fixed Rate Option, and you must allocate future payments to the Fixed Rate Option. See BenefitAccess Rider.

Processing and Valuing Transactions

Pruco Life of New Jersey is generally open to process financial transactions on those days that the New York Stock Exchange ("NYSE") is open for trading. There may be circumstances where the NYSE does not open on a regularly scheduled date or time or closes at an earlier time than scheduled (normally 4:00 p.m. Eastern Time). Generally, financial transactions received in Good Order before the close of regular trading on the NYSE will be processed according to the value next determined following the close of business. Financial transactions received on a non-business day or after the close of regular trading on the NYSE will be processed based on the value next computed on the next Valuation Day.

We will not process any financial transactions involving purchase or redemption orders on days the NYSE is closed. Pruco Life of New Jersey will also not process financial transactions involving purchase or redemption orders or transfers on any day that:


•	trading on the NYSE is restricted;


•	an emergency, as determined by the SEC, exists making redemption or valuation of securities held in the Separate Account impractical; or


•	the SEC, by order, permits the suspension or postponement for the protection of security holders.

In certain circumstances, we may need to correct the processing of an order. In such circumstances, we may incur a loss or receive a gain depending upon the price of the security when the order was executed and the price of the security when the order is corrected. With respect to any gain that may result from such order correction, we will retain any such gain as additional compensation for these correction services.

Transfers/Restrictions on Transfers

You may, up to 12 times each Contract Year, transfer amounts among the Variable Investment Options or to the Fixed Rate Option. Additional transfers may be made only with our consent. Currently, we will allow you to make additional transfers. For the first 20 transfers in a calendar year, you may transfer amounts by providing your request to us in Good Order at a Service Office. Transfers may generally be made by mail, phone, fax, or website. Contracts that are jointly owned or assigned generally cannot conduct transfers by phone, fax, or website. See Assignment.

Multiple transfers that occur during the same day, but prior to the end of the Valuation Period for that day, will be counted as a single transfer.

There is no transaction charge for the first 12 transfers per Contract Year among investment options. We may charge up to $25 for each transfer made exceeding 12 in any Contract Year. Currently, we do not charge a fee for transfers.

Currently, certain transfers effected systematically under a dollar cost averaging or an automatic rebalancing program do not count towards the limit of 12 transfers per Contract Year or the limit of 20 transfers per calendar year. In the future, we may count such transfers towards the limit.

Transfers out of the money market investment option will not be made until 10 days after you receive the Contract. Such transfers and any transfers due to any fund closures or mergers will not be considered towards the 12 transfers per Contract Year or the 20 transfers per calendar year.

Transfers among Variable Investment Options will take effect as of the end of the Valuation Period in which a transfer request is received in Good Order at a Service Office. The request may be in terms of dollars, such as a request to transfer $5,000 from one Variable Investment Option to another, or may be in terms of a percentage reallocation among Variable Investment Options. In the latter case, as with premium reallocations, the percentages must be in whole numbers.

We will use reasonable procedures, such as asking you to provide certain personal information provided on your application for insurance, to confirm that instructions given by telephone are genuine. We will not be held liable for following telephone instructions that we reasonably believe to be genuine. We cannot guarantee that you will be able to get through to complete a telephone transfer during peak periods such as periods of drastic economic or market change.

Generally, only one transfer from the Fixed Rate Option will be permitted during each Contract Year. The maximum amount per Contract you may transfer out of the Fixed Rate Option each year is the greater of: (a) 25% of the amount in the Fixed Rate Option; and (b) $2,000.

If you exercise the Overloan Protection Rider, we will then transfer any amounts you have in the Variable Investment Options to the Fixed Rate Option. The transfer is not counted as one of the 12 transfers we allow per Contract Year and there is no charge. Transfers out of the Fixed Rate Option and into the Variable Investment Options will not be permitted while your Contract is kept in f orce under the Overloan Protection Rider.

The Contract was not designed for professional market timing organizations, other organizations, or individuals using programmed, large, or frequent transfers. Large or frequent transfers among Variable Investment Options in response to short-term fluctuations in markets, sometimes called “market timing”, can make it very difficult for Fund advisers/sub-advisers to manage the Funds. Large or frequent transfers may cause the Fund to hold more cash than otherwise necessary, disrupt management strategies, increase transaction costs, or affect performance to the disadvantage of other Contract Owners. If we (in our own discretion) believe that a pattern of transfers or a specific transfer request, or group of transfer requests, may have a detrimental effect on the performance of the Funds, or we are informed by a Fund (e.g., by the Fund’s adviser/sub-advisers) that the purchase or redemption of shares in the Fund must be restricted because the Fund believes the transfer activity to which such purchase or redemption relates would have a detrimental effect on the performance of the affected Fund, we may modify your right to make transfers by restricting the number, timing, and amount of transfers. We reserve the right to prohibit transfer requests made by an individual acting under a power of attorney on behalf of more than one Contract Owner. We will immediately notify you at the time of a transfer request if we exercise this right.

Any restrictions on transfers will be applied in a uniform manner to all persons who own Contracts like this one, and will not be waived. However, due to the discretion involved in any decision to exercise our right to restrict transfers, it is possible that some Contract Owners may be able to effect transactions that could affect Fund performance to the disadvantage of other Contract Owners.

In addition, owners of variable life insurance or variable annuity contracts that do not impose the transfer restrictions described above, might make more numerous and frequent transfers than Contract Owners who are subject to such limitations. Contract owners who are not subject to the same transfer restrictions may have the same Funds available to them, and unfavorable consequences associated with such frequent trading within the Fund (e.g., greater portfolio turnover, higher transaction costs, or performance or tax issues) may affect all Contract Owners.

The Funds have adopted their own policies and procedures with respect to excessive trading of their respective shares, and we reserve the right to enforce these policies and procedures. The prospectuses for the Funds describe any such policies and procedures, which may be more or less restrictive than the policies and procedures we have adopted. Under SEC rules, we are required to: (1) enter into a written agreement with each Fund or its principal underwriter that obligates us to provide to the Fund promptly upon request certain information about the trading activity of individual Contract Owners, and (2) execute instructions from the Fund to restrict or prohibit further purchases or transfers by specific Contract Owners who violate the excessive trading policies established by the Fund. In addition, you should be aware that some Funds may receive “omnibus” purchase and redemption orders from other insurance companies or intermediaries such as retirement plans. The omnibus orders reflect the aggregation and netting of multiple orders from individual owners of variable insurance contracts and/or individual retirement plan participants. The omnibus nature of these orders may limit the Funds in their ability to apply their excessive trading policies and procedures. In addition, the other insurance companies and/or retirement plans may have different policies and procedures or may not have any such policies and procedures because of contractual limitations. For these reasons, we cannot guarantee that the Funds (and thus Contract Owners) will not be harmed by transfer activity relating to other insurance companies and/or retirement plans that may invest in the Funds.

The Funds may assess a short term trading fee in connection with a transfer out of any available Variable Investment Option if the transfer occurs within a certain number of days following the date of allocation to the Variable Investment Option. Each Fund determines the amount of the short term trading fee and when the fee is imposed. The fee is retained by or paid to the Fund and is not retained by us. The fee will be deducted from your Contract Value to the extent allowed by law. At present, no Fund has adopted a short-term trading fee.

Although our transfer restrictions are designed to prevent excessive transfers, they are not capable of preventing every potential occurrence of excessive transfer activity.

Dollar Cost Averaging

As an administrative practice, we are currently offering a feature called Dollar Cost Averaging ("DCA"). Under this feature, either fixed dollar amounts or a percentage of the amount designated for use under the DCA option will be transferred periodically from the DCA money market investment option into other Variable Investment Options available under the Contract (excluding the Fixed Rate Option). If DCA allocates money to a Variable Investment Option at a time when the Fund no longer accepts additional investments, automatic transfers to that Variable Investment Option will be directed to the PSF Government Money Market Portfolio. You may choose to have periodic transfers made monthly or quarterly. DCA transfers will not begin until the Monthly Date after 10 days following your receipt of the Contract.

Each automatic transfer will take effect as of the end of the Valuation Period on the date coinciding with the periodic timing you designate provided the New York Stock Exchange is open on that date. If the New York Stock Exchange is not open on that date, or if the date does not occur in that particular month, the transfer will take effect as of the end of the Valuation Period which immediately follows that date. Automatic transfers will continue until: (1) $50 or less remains of the amount designated for DCA, at which time the remaining amount will be transferred; or (2) you give us notification of a change in DCA allocation or cancellation of the feature. Currently, a transfer that occurs under the DCA feature is not counted towards the 20 transfers permitted each calendar year or the 12 free transfers permitted each Contract Year. We reserve the right to change this practice, modify the requirements, or discontinue the feature in a non-discriminatory manner. We will notify you prior to changing, modifying, or discontinuing this feature.

will not be allowed. See BenefitAccess Rider. DCA will not be available on Contracts kept in force under the provisions of the Overloan Protection Rider. See Overloan Protection Rider.

Auto-Rebalancing

As an administrative practice, we are currently offering a feature called Auto‑Rebalancing. This feature allows you to automatically rebalance Variable Investment Option assets at specified intervals based on percentage allocations that you choose. For example, suppose your initial investment allocation of Variable Investment Options X and Y is split 40% and 60%, respectively, and investment results cause that split to change. You may instruct that those assets be rebalanced to your original or different allocation percentages. Auto-rebalancing is not available until the Monthly Date after 10 days following your receipt of the Contract.

Auto-rebalancing can be performed on a quarterly, semi-annual, or annual basis. Each rebalance will take effect as of the end of the Valuation Period on the date coinciding with the periodic timing you designate, provided the New York Stock Exchange is open on that date. If the New York Stock Exchange is not open on that date, or if the date does not occur in that particular month, the transfer will take effect as of the end of the Valuation Period immediately following that date. The Fixed Rate Option cannot participate in this administrative procedure. If auto-rebalancing involves allocating to a Fund that became closed to additional investments, the auto-rebalancing feature will be turned off. Currently, a transfer that occurs under the auto-rebalancing feature is not counted towards the 20 transfers permitted each calendar year or the 12 free transfers permitted each Contract Year. We reserve the right to change this practice, modify the requirements, or discontinue the feature in a non-discriminatory manner. We will notify you prior to changing, modifying, or discontinuing this feature.

When you submit a claim under the Chronic Illness Option of the BenefitAccess Rider, you must authorize a transfer of all Contract value from the Variable Investment Options to the Fixed Rate Option. While your claim is reviewed and while you are receiving Benefit Payments, Contract value must remain in the Fixed Rate Option, and you must allocate future payments to the Fixed Rate Option. Auto-rebalancing will not be allowed. See BenefitAccess Rider. Auto-rebalancing will not be available on Contracts kept in f orce under the provisions of the Overloan Protection Rider. See Overloan Protection Rider.

DEATH BENEFITS

When Death Benefit Proceeds Are Paid

Generally, we will pay any Death Benefit within seven days after all the documents required for such a payment are received in Good Order at the office designated to receive that request. The Death Benefit is determined as of the date of death.

We may delay payment of proceeds from the Variable Investment Option(s) and the variable portion of the Death Benefit due under the Contract if the disposal or valuation of the Account's assets is not reasonably practicable because the New York Stock Exchange is closed for other than a regular holiday or weekend, trading is restricted by the SEC, or the SEC declares that an emergency exists.

Death Claim Settlement Options

The beneficiary may choose to receive death claim proceeds by any of the settlement options available at the time the proceeds become payable or by payment of a lump sum check.

In addition to the available settlement options, currently, in certain circumstances, the beneficiary may choose the payment of death claim proceeds by way of the Alliance Account settlement option (the "Alliance Account"). If the Alliance Account is selected, Prudential will provide a kit to the beneficiary, which includes: (1) an account confirmation describing the death claim proceeds, the current interest rate, and the terms of the Alliance Account; and (2) a guide that explains how the Alliance Account works. Amounts in an Alliance Account earn interest at a rate set by Prudential . This rate is not guaranteed and can change. The beneficiary may withdraw amounts in an Alliance Account at any time. Alliance Account balances are not insured by the Federal Deposit Insurance Corporation. Any Pruco Life of New Jersey representative authorized to sell this Contract can explain all the settlement options upon request.

Types of Death Benefit

You must select from three types of Death Benefit at issue. A Contract with a Type A (fixed) Death Benefit has a Death Benefit which will generally equal the Basic Insurance Amount. Favorable investment results and additional premium payments will generally increase the Cash Surrender Value and decrease the Net Amount at Risk and result in lower charges. This type of Death Benefit does not vary with the investment performance of the investment options you selected, except when the premiums you pay or favorable investment performance causes the Contract Fund to grow to the point where we may increase the Death Benefit to ensure that the Contract will satisfy the Internal Revenue Code’s definition of life insurance. See Cost of Insurance, PREMIUMS, and How a Contract's Cash Surrender Value Will Vary.

A Contract with a Type B (variable) Death Benefit has a Death Benefit which will generally equal the Basic Insurance Amount plus the Contract Fund. Favorable investment performance and additional premium payments will generally increase your Contract's Death Benefit and Cash Surrender Value. However, the increase in the Cash Surrender Value for a Contract with a Type B Death Benefit may be less than the increase in Cash Surrender Value for a Contract with a Type A Death Benefit because a Type B Death Benefit has a greater cost of insurance charge due to a greater Net Amount at Risk. As long as the Contract is not in default and there is no Contract Debt, the Death Benefit may not fall below the Basic Insurance Amount stated in the Contract. We may increase the Death Benefit to ensure that the Contract will satisfy the Internal Revenue Code’s definition of life insurance. See Cost of Insurance, PREMIUMS, and How a Contract's Cash Surrender Value Will Vary.

A Contract with a Type C (return of premium) Death Benefit has a Death Benefit which is generally equal the Basic Insurance Amount plus the total premiums paid into the Contract less withdrawals. The total premiums, less withdrawals, is not accumulated with interest. The Death Benefit on a Contract with a Type C Death Benefit is limited to the greater of (1) the Contract Fund plus twice the Basic

Insurance Amount or (2) a Death Benefit amount required to satisfy the Internal Revenue Code’s definition of life insurance. Within limits, this Death Benefit type allows the beneficiary, in effect, to recover the cost of the Contract (all premiums paid less withdrawals already taken), upon the death of the insured. Favorable investment performance and payment of additional premiums will generally increase the Contract's Cash Surrender Value. However, the increase in the Cash Surrender Value for a Type C Death Benefit may be less than the increase in Cash Surrender Value for a Contract with a Type A Death Benefit because a Type C Death Benefit has a greater cost of insurance charge due to a greater Net Amount at Risk. The increase in Cash Surrender Value for a Contract with a Type C Death Benefit may be more or less than the increase in Cash Surrender Value for a Contract with a Type B Death Benefit depending on earnings and the amount of any withdrawals. If you take a withdrawal from a Contract with a Type C Death Benefit, it is possible for the Death Benefit to fall below the Basic Insurance Amount. We may increase the Death Benefit to ensure that the Contract will satisfy the Internal Revenue Code’s definition of life insurance. See Cost of Insurance, PREMIUMS, and How a Contract’s Cash Surrender Value Will Vary.

The way in which the Cash Surrender Value and Death Benefit will change depends significantly upon the investment results that are actually achieved.

Contract Owners of a Contract with a Type A Death Benefit should note that any withdrawal will generally result in a reduction of the Basic Insurance Amount by the amount of the withdrawal and will result in the deduction of any applicable surrender charg e. See Withdrawals.

Changing the Type of Death Benefit

You may change the type of Death Benefit any time after issue and subject to our approval. We will increase or decrease the Basic Insurance Amount so that the Death Benefit immediately after the change matches the Death Benefit immediately before the change. The Basic Insurance Amount after a change may not be lower than the minimum Basic Insurance Amount applicable to the Contract. See REQUIREMENTS FOR ISSUANCE OF A CONTRACT. We may deduct a transaction charge of up to $25 for any change in the Basic Insurance Amount, although we do not currently do so. A Death Benefit type change that reduces the Basic Insurance Amount may result in the assessment of a surrender charg e. See CHARGES AND EXPENSES.

If you are changing your Contract from a Type A Death Benefit to a Type B Death Benefit, we will reduce the Basic Insurance Amount by the amount in your Contract Fund on the date the change takes place.

If you are changing your Contract from a Type B Death Benefit to a Type A Death Benefit, we will increase the Basic Insurance Amount by the amount in your Contract Fund on the date the change takes place.

If you are changing your Contract from a Type C Death Benefit to a Type A Death Benefit, we will change the Basic Insurance Amount by adding the lesser of (a) the total premiums paid minus total withdrawals to this Contract, both accumulated with interest at the rate(s) displayed in your Contract Data pages and (b) the Contract Fund before deduction of any monthly charge due on that date plus the product of the Type C Limiting Amount multiplied by the Type C Death Benefit Factor. The Type C Limiting Amount and the Type C Death Benefit Factor are both found in the Contract Limitations section of your Contract's data pages.

If you are changing your Contract from a Type C Death Benefit to a Type B Death Benefit, we first find the difference between: (1) the Contract Fund and (2) the lesser of (a) the total premiums paid minus total withdrawals to this Contract both accumulated with interest at the rate(s) displayed in your Contract Data pages and (b) the Contract Fund before deduction of any monthly charge due on that date plus the product of the Type C Limiting Amount multiplied by the Type C Death Benefit Factor. The Type C Limiting Amount and the Type C Death Benefit Factor are both found in the Contract Limitations section of your Contract's data pages. If (2) is larger than (1), we will increase the Basic Insurance Amount by that difference. If (1) is larger than (2), we will reduce the Basic Insurance Amount by that difference.

You may change your Contract’s Death Benefit type after issue, however, if you choose a Type A Death Benefit or a Type B Death Benefit at issue, you will not be able to change to a Type C Death Benefit thereafter. If you change a Type C Death Benefit to a Type A Death Benefit or a Type B Death Benefit after issue, you will not be able to change back to a Type C Death Benefit. We will not allow a change to your Contract if it will cause the Death Benefit to exceed our retention limits or violate any other underwriting rule.

The following chart illustrates the changes in Basic Insurance Amount with each change of Death Benefit type described above. The chart assumes a $50,000 Contract Fund and a $300,000 Death Benefit. For changes from a Type C Death Benefit, the chart assumes $40,000 in total premiums minus total withdrawals and the rate chosen to accumulate premiums is 0%.



Basic Insurance Amount
FROM	TO
Type A $300,000	Type B $250,000	Type C N/A
Type B $250,000	Type A $300,000	Type C N/A
Type C $260,000	Type A $300,000	Type B $250,000

You may request a change in the type of Death Benefit by sending us a request in Good Order to our Service Office. If the change is approved, we will recalculate the Contract's charges and appropriate tables and send you new Contract data pages. We may require you to send us your Contract before making the change. There may be circumstances under which a change in the Death Benefit type

may cause the Contract to be classified as a Modified Endowment Contract, which could be significantly disadvantageous. See Tax Treatment of Contract Benefits.

When you submit a claim under the Chronic Illness Option of the BenefitAccess Rider, your Contract’s Death Benefit type must changed to Type A (if not already so) and remain as Type A for the duration of the Contract. See BenefitAccess Rider.

No-Lapse Guarantee

If you pay one of the two No-Lapse Guarantee Premiums as described below, we will guarantee that your Contract will not lapse as a result of unfavorable investment performance, and a Death Benefit will be paid upon the death of the insured, even if your Contract Fund value drops to zero. The No-Lapse Guarantee is based on premium payments and is not a benefit you need to elect. Withdrawals and outstanding Contract loans may adversely affect the status of the No-Lapse Guarantee. See Withdrawals and Loans.

How We Calculate and Determine if You Have a No-Lapse Guarantee

We calculate your Contract's Accumulated Net Payments on the Contract Date and on each Monthly Date thereafter. Accumulated Net Payments equal the premiums you paid, accumulated at an effective annual rate of 4%, less withdrawals accumulated at 4%. For Contracts that had previously lapsed because of excess Contract Debt, also subtract the Contract Debt in effect at the time of lapse accumulated at 4% starting at the date of default. If you have an outstanding Contract loan, a No-Lapse Guarantee will not keep the Contract in f orce.

We also calculate No-Lapse Guarantee Values. These are values used solely to determine if a No-Lapse Guarantee is in effect and vary by Basic Insurance Amount, issue age, sex, underwriting classification, and any optional benefits selected. These are not cash values that you can realize by surrendering the Contract, nor are they payable Death Benefits.

On each Monthly Date, we will compare your Accumulated Net Payments to the No-Lapse Guarantee Value. If your Accumulated Net Payments equal or exceed the No-Lapse Guarantee Value, and the Contract Debt does not equal or exceed the Contract Fund less any applicable surrender charg e, then the Contract is kept in force, regardless of the amount in the Contract Fund.

No-Lapse Guarantee Premiums and No-Lapse Guarantee Periods Available Under Your Contract

There are two No Lapse Guarantee Premiums that correspond to the No Lapse Guarantee periods; the Short Term No-Lapse Guarantee Premiums and the Limited No-Lapse Guarantee Premiums, which are payment levels that are compared to the No-Lapse Guarantee Values. This is a flexible premium payment Contract and you may make payments at any time. The description below assumes you pay the No Lapse Guarantee Premium at the beginning of each Contract Year. If you make any premium payments after the beginning of each Contract Year you may need to pay more premiums because the Accumulated Net Payments will be less due to reduced interest accumulation than if you paid at the beginning of the Contract Year.

1) All Contracts have a Short Term No-Lapse Guarantee period. A Contract with a Type C Death Benefit will only have a Short Term No-Lapse Guarantee available Payment of the Short Term No-Lapse Guarantee Premium at the beginning of each Contract Year guarantees that your Contract will not lapse during the Short Term No-Lapse Guarantee period, assuming there are no loans or withdrawals. However, continued payment of the Short Term No-Lapse Guarantee Premium after this period will not assure that your Contract's Accumulated Net Payments will continue to meet the No-Lapse Guarantee Values and prevent the Contract from lapsing. See PREMIUMS.

2) The Limited No-Lapse Guarantee Period is available for all contracts other than those with a Type C Death Benefit. If you want a longer No-Lapse Guarantee, paying the Limited No-Lapse Guarantee Premium at the beginning of each Contract Year guarantees your Contract against lapse during the Limited No-Lapse Guarantee period, assuming no loans or withdrawals.

The Short Term No-Lapse Guarantee period is 8 years after issue (6 years for ages 60 and older). The Limited No-Lapse Guarantee period lasts until the later to occur of the Contract Anniversary that the insured reaches Attained Age 75 or 10 years after issue.

The following tables provide sample Short Term No-Lapse and Limited No-Lapse Guarantee Premiums (to the nearest dollar). The examples assume: (1) the insured is a male, Preferred Best underwriting class; (2) a $500,000 Basic Insurance Amount; and (3) no extra benefit riders have been added to the Contract.



Illustrative Annual Premiums
Age of insured at issue	Type of Death Benefit Chosen	Short Term No-Lapse Guarantee Premium	Limited No-Lapse Guarantee Premium
35	Type A	$1,975	$3,300
35	Type B	$1,975	$3,480
35	Type C	$1,975	N/A
55	Type A	$5,395	$8,070
55	Type B	$6,080	$8,115
55	Type C	$6,080	N/A
75	Type A	$20,835	$50,380
75	Type B	$24,630	$52,135
75	Type C	N/A	N/A

Maintaining the No-Lapse Guarantee

Paying the Short Term No-Lapse or Limited No-Lapse Guarantee Premiums at the start of each Contract Year is one way of reaching the No-Lapse Guarantee Values. The No-Lapse Guarantee allows considerable flexibility as to the timing of premium payments. Your Pruco Life of New Jersey representative can supply sample illustrations of various premium amount and frequency combinations that correspond to the No-Lapse Guarantee Values.

When determining what premium amounts to pay and the frequency of your payments, you should consider carefully the value of maintaining a No-Lapse Guarantee. For example, if you desire the Limited No-Lapse Guarantee until the later to occur of the insured's Attained Age 75 or 10 years after issue, you may prefer to pay at least the Limited No-Lapse Guarantee Premium in all years, rather than paying the lower Short Term No-Lapse Guarantee Premium in the first eight years after issue (six years for issue ages 60 and above). If you pay only the Short Term No-Lapse Guarantee Premium in the first eight years (six years for issue ages 60 and above), you will need to pay more than the Limited No-Lapse Guarantee Premium at the beginning of the 9th year (7th year for issue ages 60 and above) in order to continue the No-Lapse Guarantee.

For example assume: (1) an insured male age 27, nonsmoker underwriting class (2) a $500,000 Basic Insurance Amount; Type B Death Benefit; no extra benefit riders, and (3) no loans. The Short Term No-Lapse Guarantee Premium would be $1,725, which if paid at the beginning of each year from Contract issue, would provide the Short Term No-Lapse Guarantee for 8 years. The accumulated premiums at 4% less withdrawals accumulated at 4% would be $16,531. The Limited No-Lapse Guarantee premium would be $2,700, which if paid at the beginning of each year from Contract issue, would provide the Limited No-Lapse Guarantee for 40 years. However, if the individual in this example paid $1,725 annually from Contract issue for 8 years and then decided he wanted the Limited No-Lapse Guarantee, he would have to pay enough premium so that the accumulated premiums at 4% less withdrawals accumulated at 4% would be $29,717 at the end of year 9.

In addition, it is possible that the payment required to continue the guarantee beyond the Short Term No-Lapse Guarantee period could exceed the premium payments allowed to be paid without causing the Contract to become a Modified Endowment Contract. See Tax Treatment of Contract Benefits.

Decreases in Basic Insurance Amount

You have the option of decreasing the Basic Insurance Amount of your Contract without withdrawing any Cash Surrender Value. If a change in circumstances causes you to determine that your amount of insurance is greater than needed, a decrease will reduce your insurance protection and the monthly deductions for the cost of insurance.

The following conditions must be met:


(a)	The amount of the decrease must be at least equal to the minimum decrease in the Basic Insurance Amount shown under Contract Limitations in your Contract’s data pages;


(b)	The Basic Insurance Amount after the decrease must be at least equal to the minimum Basic Insurance Amount shown under Contract Limitations in your Contract’s data pages;


(c)	The Contract must not be in default;


(d)	The surrender charge on the decrease, if any, plus any transaction charge for the decrease may not exceed the Contract Fund;


(e)	If we ask you to do so, you must send us the Contract to be endorsed;


(f)	Your Contract must not be in force under the provisions of the Overloan Protection Rider; and


(g)	You must not have exercised the Chronic Illness option under the BenefitAccess Rider.

If we approve the decrease, we will send you new Contract data pages showing the amount and effective date of the change and the recalculated charges, values, and limitations. Currently, no transaction charge is being made in connection with a decrease in the Basic Insurance Amount. However, we reserve the right to charge such a fee in an amount of up to $25.

It is important to note, however, that if the Basic Insurance Amount is decreased, there is a possibility that the Contract will be classified as a Modified Endowment Contract. See Tax Treatment of Contract Benefits. You should consult with your tax adviser and your Pruco Life of New Jersey representative before requesting any decrease in Basic Insurance Amount.

CONTRACT VALUES

How a Contract's Cash Surrender Value Will Vary

The Contract's Cash Surrender Value on any date will be the Contract Fund less any applicable surrender charg e and less any Contract Debt. The Contract Fund value changes daily, reflecting:


(1)	increases or decreases in the value of the Fund(s);


(2)	interest credited on any amounts allocated to the Fixed Rate Option;


(3)	interest credited on any loan; and


(4)	the daily asset charge for mortality and expense risks assessed against the Variable Investment Options.

The Contract Fund value also changes to reflect the receipt of premium payments after any charges are deducted, the monthly deductions described under CHARGES AND EXPENSES, any withdrawals or accelerated benefits, and any added persistency credit. See Withdrawals, RIDERS, and Persistency Credit. Upon request, we will tell you the Cash Surrender Value of your Contract. It is possible for the Cash Surrender Value of a Contract to decline to zero because of unfavorable investment performance or outstanding Contract Debt.

Persistency Credit

On each Monthly Date, if your Contract has been i n f orce at least 6 years and is not in default, we will credit your Contract Fund with an additional amount, called a persistency credit, for keeping your Contract in force. The annual persistency credit rate is 0.25%. The persistency credit is based on reduced costs in later Contract Years and applies to Contracts that remain in f orce.

The following chart illustrates an example of a Contract with $100,000 of Contract Fund, net of outstanding loans. In this example the persistency credit is calculated using the annual rate of 0.25% of the Contract Fund, net of outstanding loans, but is expressed as a monthly rate to reflect that the amount is credited monthly. The credited amount will be allocated to the investment options in the same manner as premiums are allocated.



Determination of Sample Persistency Credit
Contract Fund (net of outstanding loans)	$100,000.00
Monthly Credit Rate	0.020809%
Persistency Credit Amount	$20.81
New Contract Fund (net of outstanding loans)	$100,020.81

On and following the 6th Contract Anniversary, if your Contract is i n force, we will credit your Contract Fund with the calculated amount for that Monthly Date. If your Contract is in default or has lapsed, we will not credit your Contract with the persistency credit. The calculated amount that would have been credited during the time your Contract was in default or lapsed will not be made up if your Contract is reinstated. However, if your Contract is reinstated, we will begin calculating a persistency credit on the Monthly Date following the reinstatement date. The persistency credit will not change the status of your Contract if your cash value is zero or less. No persistency credit will be calculated on the amount of any Contract loan.

Loans

You may borrow an amount up to the current loan value of your Contract less any existing Contract Debt using the Contract as the only security for the loan. The loan value at any time is equal to the sum of (1) 99% of the portion of the cash value attributable to the Variable Investment Options and (2) the balance of the cash value, provided the Contract is not in default. The cash value is equal to the Contract Fund less any surrender charge. A Contract in default has no loan value. There is no minimum loan amount.

Interest charged on a loan accrues daily. We charge interest on the full loan amount, including all unpaid interest. Interest is due on each Contract Anniversary or when the loan is paid back, whichever comes first. If interest is not paid when due, we will increase the loan amount by any unpaid interest. We charge interest at an effective annual rate of 2% for standard loans.

Any amount you borrow on or after the 10th Contract Anniversary will be considered a preferred loan. On the tenth Contract Anniversary, if the insured is living and the Contract is in force, any existing loan amount will automatically be converted to a preferred loan. Preferred loans are charged interest at an effective annual rate of 1.05%.

When a loan is made, an amount equal to the loan proceeds is transferred out of the Variable Investment Options and/or the Fixed Rate Option, as applicable. Unless you ask us to take the loan amount from specific Variable Investment Options and we agree, the reduction will be made in the same proportions as the value in each Variable Investment Option and the Fixed Rate Option bears to the total value of the Contract. While a loan is outstanding, the amount that was transferred will continue to be treated as part of the Contract Fund. It will be credited with interest at an effective annual rate of 1%. On each Monthly Date, we will increase the portion of the Contract Fund in the investment options by interest credits accrued on the loan since the last Monthly Date.

The Contract Debt is the amount of all outstanding loans plus any interest accrued but not yet due. If, on any Monthly Date, the Contract Debt equals or exceeds the Contract Fund less any applicable surrender charg e, the Contract will go into default. The No-Lapse Guarantee will not prevent default under those circumstances. We will notify you of a 61-day grace period, within which time you may repay all or enough of the loan to obtain a positive Cash Surrender Value and thus keep the Contract in f orce. If you send us a payment during the grace period and we receive it after a Monthly Date has occurred, we will credit interest to the Contract Fund from the date your Contract went into default to the date we received your payment, and then return to crediting interest on subsequent Monthly Dates. If the Contract lapses or is surrendered, the amount of unpaid Contract Debt will be treated as a distribution and will be immediately taxable to the extent of gain in the Contract. Reinstatement of the Contract after lapse will not eliminate the taxable income, which we are required to report to the IRS. See LAPSE AND REINSTATEMENT and Tax Treatment of Contract Benefits - Pre-Death Distributions.

If your Contract includes the Overloan Protection Rider and you meet the requirements to exercise the rider, you may have protection against lapse due to excessive Contract Debt. See Overloan Protection Rider.

No persistency credit will be calculated on the amount of any Contract loans. See Persistency Credit.

Loans you take against the Contract are ordinarily treated as debt and are not considered distributions subject to tax. However, you should know that the IRS may take the position that the loan should be treated as a distribution for tax purposes because of the relatively low differential between the loan interest rate and the Contract’s crediting rate. Distributions are subject to income tax. Were the IRS to take this position, we would take reasonable steps to attempt to avoid this result, including modifying the Contract’s loan provisions, but cannot guarantee that such efforts would be successful.

A loan will not cause the Contract to lapse as long as Contract Debt does not equal or exceed the Contract Fund, less any applicable surrender charg e. Loans from Modified Endowment Contracts may be treated for tax purposes as distributions of income. See Tax Treatment of Contract Benefits.

Any Contract Debt will directly reduce a Contract's Cash Surrender Value and will be subtracted from the Death Benefit to determine the amount payable. In addition, even if the loan is fully repaid, it may have an effect on future Death Benefits because the investment results of the selected investment options will apply only to the amount remaining invested under those options. The longer the loan is outstanding, the greater the effect is likely to be. The effect could be favorable or unfavorable. If investment results are greater than the rate being credited on the amount of the loan while the loan is outstanding, values under the Contract will not increase as rapidly as they would have if no loan had been made. If investment results are below that rate, Contract values will be higher than they would have been had no loan been made.

Loan repayments are applied to reduce the total outstanding Contract Debt, which is equal to the principal plus accrued interest. Interest accrues daily on the total outstanding Contract Debt, and making a loan repayment will reduce the amount of interest accruing.

Loan repayments will be applied towards the loan according to when they are received. Loan interest is due on your Contract Anniversary. If we receive your loan repayment within 21 days prior to your Contract Anniversary, we will apply the repayment towards interest due. Any loan repayment amount exceeding the interest due is applied towards the existing principal amount.

If we receive your loan repayment at any time outside of 21 days prior to your Contract Anniversary, we will apply the repayment towards the principal amount. For any repayment exceeding the principal amount, we will apply the remainder of the loan repayment towards the interest due.

When you repay all or part of a loan, we will increase the portion of the Contract Fund in the investment options by the amount of the loan you repay plus interest credits accrued on the repaid portion of the loan since the last transaction date. We will apply the loan repayment to the investment allocation used for future premium payments as of the loan repayment date. If loan interest is paid when due, it will not change the portion of the Contract Fund allocated to the investment options. We reserve the right to change the manner in which we allocate loan repayments.

Loan repayments are required when exercising either option of the BenefitAccess Rider. See BenefitAccess Rider.

Withdrawals

You may withdraw a portion of the Contract's Cash Surrender Value without surrendering the Contract, subject to the following restrictions:


(1)	We must receive a request for the withdrawal in Good Order at our Service Office.


(2)	Your Contract’s Cash Surrender Value after the withdrawal may not be less than or equal to zero after deducting (a) any charges associated with the withdrawal and (b) an amount that we estimate will be sufficient to cover two months of Contract Fund deductions.


(3)	The withdrawal amount must be at least $500.


(4)	The Basic Insurance Amount after withdrawals must be at least equal to the minimum Basic Insurance Amount shown in the Contract.


(5)	Your Contract must not be in f orce under the provisions of the Overloan Protection Rider.


(6)	You must not be receiving Benefit Payments under the BenefitAccess Rider.

We may charge a transaction fee for each withdrawal of up to $25. Currently, we do not charge a fee for a withdrawal. A withdrawal may not be repaid except as a premium subject to the applicable charges. Upon request, we will tell you how much you may withdraw. Withdrawal of the Cash Surrender Value may have tax consequences. See Tax Treatment of Contract Benefits.

Whenever a withdrawal is made, the Death Benefit will immediately be reduced by at least the amount of the withdrawal. The withdrawal may also decrease the Basic Insurance Amount, which may result in the deduction of a surrender charge. See Surrender Charg e . Withdrawals from a Contract with a Type B or Type C Death Benefit will not change the Basic Insurance Amount. However, under most circumstances, withdrawals from a Contract with a Type A Death Benefit require a reduction in the Basic Insurance Amount. It is possible a withdrawal from a Contract with a Type A Death Benefit will not decrease the Basic Insurance Amount if the Contract Fund has grown to the point where the base Contract’s Death Benefit has been increased as required by the Internal Revenue Code's definition of life insurance test. See Tax Treatment of Contract Benefits.

The following table provides a hypothetical example of a withdrawal from a Contract with a Type A Death Benefit. The example assumes the withdrawal occurred in the 5th Contract Year, no Contract Debt, the Death Benefit was not increased to satisfy the definition of life insurance test, and no change to the Basic Insurance Amount has previously occurred.



Example of a Type A Death Benefit Withdrawal
Net amount of withdrawal:		$10,000
Withdrawal Surrender Charge (2% reduction):		$60
Gross amount of withdrawal:		$10,060
Contract values	Before	After
Basic Insurance Amount:	$500,000	$490,000
Death Benefit amount:	$500,000	$490,000
Contract Fund value:	$100,000	$89,940
Contract Surrender Charge (current):	$3,000	$2,940

No withdrawal will be permitted from a Contract with a Type A Death Benefit if it would result in a Basic Insurance Amount of less than the minimum Basic Insurance Amount shown under Contract Limitations in your Contract’s data pages. It is important to note, however, that if the Basic Insurance Amount is decreased, there is a possibility that the Contract might be classified as a Modified Endowment Contract. Before making any withdrawal that causes a decrease in Basic Insurance Amount, you should consult with your tax adviser and your Pruco Life of New Jersey representative. See Tax Treatment of Contract Benefits.

Currently, we will provide an authorization form if your withdrawal request causes a decrease in Basic Insurance Amount that results in your Contract being classified as a Modified Endowment Contract. The authorization form will confirm that you are aware of your Contract becoming a Modified Endowment Contract if the transaction is completed. We will complete the transaction and send a confirmation notice after we receive the completed authorization form in Good Order at a Service Office.

When a withdrawal is made, the Contract Fund is reduced by the withdrawal amount and any charges associated with the withdrawal. An amount equal to the reduction in the Contract Fund will be withdrawn proportionally from the investment options unless you direct otherwise. Withdrawal of any portion of the Cash Surrender Value increases the risk that the Contract Fund may be insufficient to provide Contract benefits. If such a withdrawal is followed by unfavorable investment experience, the Contract may go into default. Withdrawals may also affect whether a Contract is kept in force under the No-Lapse Guarantee, since withdrawals decrease your Accumulated Net Payments. See No-Lapse Guarantee.

Surrender of a Contract

You may surrender your Contract at any time for its Cash Surrender Value (referred to as Net Cash Value in the Contract) while the insured is living. To surrender your Contract, we may require you to deliver or mail the following items in Good Order to a Service Office: (a) the Contract, (b) a signed request for surrender, (c) any tax withholding information required under federal or state law, and (d) the authorization of any assignee or irrevocable beneficiary. The Cash Surrender Value will be determined as of the end of the Valuation Period in which a surrender request is received in Good Order at a Service Office. Surrender of a Contract may have tax consequences. See Tax Treatment of Contract Benefits and Surrender Charge.

Fixed reduced paid-up insurance is an alternative to surrendering your Contract. Fixed reduced paid-up insurance provides paid-up insurance, the amount of which will be paid when the insured dies. There will be cash values and loan values. The loan interest rate for fixed reduced paid-up insurance is 5.5%. Upon surrender of the Contract, the amount of fixed reduced paid-up insurance depends upon the Cash Surrender Value and the insured’s issue age, sex, smoker/nonsmoker status, and the length of time since the Contract Date.

Additional requirements exist if you are exchanging your Contract for a new one at another insurance company. We specifically require a properly signed assignment to change ownership of your Contract to the new insurer and a request for surrender, signed by an authorized officer of the new insurer. The new insurer should submit these documents directly to us by sending them in Good Order to our Service Office. Generally, we will pay your Contract’s Cash Surrender Value to the new insurer within seven days after all the documents required for such a payment are received in Good Order at our Service Office.

When Proceeds Are Paid

Generally, we will pay any Cash Surrender Value, loan proceeds, or withdrawal within seven days after all the documents required for such a payment are received in Good Order at the office designated to receive that request. The amount will be determined as of the end of the Valuation Period in which the necessary documents are received in Good Order at the office designated to receive that request.

We may delay payment of proceeds from the Variable Investment Option(s) if the disposal or valuation of the Account's assets is not reasonably practicable because the New York Stock Exchange is closed for other than a regular holiday or weekend, trading is restricted by the SEC, or the SEC declares that an emergency exists.

We have the right to delay payment of the Cash Surrender Value (including surrenders of fixed reduced paid-up Contracts) attributable to the Fixed Rate Option for up to six months. We will pay interest of at least 1.5% per year if such a payment is delayed for more than 10 days.

LAPSE AND REINSTATEMENT

We will determine the value of the Contract Fund on each Monthly Date. If the Contract Fund less any applicable surrender charg e is zero or less, the Contract is in default unless it remains in force under a No-Lapse Guarantee, assuming there are no outstanding loans. See No-Lapse Guarantee. Separately, if the Contract Debt ever grows to be equal to or more than the Contract Fund less any applicable surrender charg e, the Contract will be in default. Should this happen, we will send you a notice of default setting forth the payment which we estimate will keep the Contract in f orce for three months from the date of default. A 61-day grace period will begin from the date the notice of default is mailed. Your payment must be received or postmarked within the 61-day grace period or the Contract will end and have no value. To prevent your Contract from lapsing, your payment must be in Good Order when received at the Payment Office. A Contract that lapses with an outstanding Contract loan may have tax consequences. See Tax Treatment of Contract Benefits. We reserve the right to change the requirements to reinstate a lapsed Contract.

A Contract that ended in default may be reinstated within five years from the date of default, if the following conditions are met:


(a)	We receive a written request for reinstatement in Good Order at our Service Office;


(b)	Renewed evidence of insurability is provided on the insured;


(c)	Submission of certain payments sufficient to bring the Contract up to date plus a premium that we estimate will cover all charges and deductions for three months from the date of reinstatement; and


(d)	The insured is living on the date the Contract is reinstated.

The reinstatement date will be the date we approve your request. We will deduct all required charges from your payment and the balance will be placed into your Contract Fund. If we approve the reinstatement, we will credit the Contract Fund with an amount equal to the surrender charge applicable as of the date of reinstatement.

TAXES

Tax Treatment of Contract Benefits

This summary provides general information on the federal income tax treatment of the Contract. It is not a complete statement of what the federal income taxes will be in all circumstances. It is based on current law and interpretations, which may change. It does not cover state taxes or other taxes. It is not intended as tax advice. You should consult your own tax adviser for complete information and advice.

Treatment as Life Insurance. The Contract must meet certain requirements to qualify as life insurance for tax purposes. These requirements include certain definitional tests and rules for diversification of the Contract’s investments. For further information on the diversification requirements, see Taxation in the statements of additional information for the Funds.

In order to meet the definition of life insurance rules for federal income tax purposes, the Contract must satisfy one of the two following tests: (1) Cash Value Accumulation Test or (2) Guideline Premium Test. At issue, the Contract Owner chooses which of these two tests will apply to their Contract. This choice cannot be changed thereafter.

Under the Cash Value Accumulation Test, the Contract must maintain a minimum ratio of Death Benefit to cash value. Therefore, in order to ensure that the Contract qualifies as life insurance, the Contract's Death Benefit may increase as the Contract Fund value increases. The Death Benefit, at all times, must be at least equal to the Contract Fund multiplied by the applicable Attained Age factor. Attained Age factors under the Cash Value Accumulation test vary based on the Attained Age, sex, and smoker classification of the insured. For example, the Attained Age factors for a male, age 27, nonsmoker, range from 6.34 in the first year to 1.00 at age 121. A listing of Attained Age factors can be found on your Contract’s data pages.

Under the Guideline Premium Test, there is a limit as to the amount of premium that can be paid into the Contract in relation to the Death Benefit. In addition, there is a minimum ratio of Death Benefit to cash value associated with this test. This ratio, however, is less than the required ratio under the Cash Value Accumulation Test. Therefore, the Death Benefit required under this test is generally lower than that of the Cash Value Accumulation Test. The Attained Age factors under the Guideline Premium test are based on the Attained Age of the insured. For example, the Attained Age factors for an insured age 27 range from 2.50 in the first year to 1.00 at age 95.

The selection of the definition of life insurance test most appropriate for you is dependent on several factors, including the insured’s age at issue, actual Contract earnings, and whether or not the Contract is classified as a Modified Endowment Contract. In addition, the Guideline Premium Test is required for the definition of life insurance if you choose to have the Overloan Protection Rider. See Overloan Protection Rider. You should consult your own tax adviser for complete information and advice with respect to the selection of the definition of life insurance test.

We believe we have taken adequate steps to insure that the Contract qualifies as life insurance for tax purposes. Generally speaking, this means that:


•	you will not be taxed on the growth of the funds in the Contract, unless you receive a distribution from the Contract, or if the Contract lapses or is surrendered, and


•	the Contract's Death Benefit will generally be income tax free to your beneficiary. However, your Death Benefit may be subject to estate taxes, and


•	we may refuse to accept any payment that increases the Death Benefit by more than it increases the Contract Fund.

Although we believe that the Contract should qualify as life insurance for tax purposes, there are some uncertainties, particularly because the Secretary of Treasury has not yet issued permanent regulations that bear on this question. Accordingly, we reserve the right to make changes -- which will be applied uniformly to all Contract Owners after advance written notice -- that we deem necessary to insure that the Contract will qualify as life insurance.

The contract may not qualify as life insurance under federal tax law after the Insured has attained age 100 and may be subject to adverse tax consequences. A tax adviser should be consulted before you choose to continue the contract after the insured reaches age 100.

Pre-Death Distributions. The tax treatment of any distribution you receive before the insured’s death depends on whether the Contract is classified as a Modified Endowment Contract.

Contracts Not Classified as Modified Endowment Contracts

•

If you surrender the Contract or allow it to lapse, you will be taxed on the amount you received in excess of the premiums you paid less the untaxed portion of any prior withdrawals. For this purpose, you will be treated as receiving any portion of the Cash Surrender Value used to repay Contract Debt. In other words, you will immediately have taxable income to the extent of gain in the Contract. Reinstatement of the Contract after lapse will not eliminate the taxable income, which we are required to report to the IRS. The tax consequences of a surrender may differ if you take the proceeds under an income payment settlement option.

•

Generally, you will be taxed on a withdrawal to the extent the amount you receive exceeds the premiums you paid for the Contract less the untaxed portion of any prior withdrawals. However, under some limited circumstances, in the first 15 Contract Years, all or a portion of a withdrawal may be taxed if the Contract Fund exceeds the total premiums paid less the untaxed portions of any prior withdrawals, even if total withdrawals do not exceed total premiums paid.


•	Extra premiums for optional benefits and riders generally do not count in computing the premiums paid for the Contract for the purposes of determining whether a withdrawal is taxable.

•

Loans you take against the Contract are ordinarily treated as debt and are not considered distributions subject to tax. However, you should know that the IRS may take the position that the preferred loan should be treated as a distribution for tax purposes because of the relatively low differential between the loan interest rate and the Contract’s crediting rate. Were the IRS to take this position, we would take reasonable steps to avoid this result, including modifying the Contract’s loan provisions.

Modified Endowment Contracts

•

The rules change if the Contract is classified as a Modified Endowment Contract. The Contract could be classified as a Modified Endowment Contract if premiums in amounts that are too large are paid or a decrease in the Basic Insurance Amount is made (or a rider removed). We will notify you if a premium or a change in Basic Insurance Amount would cause the Contract to become a Modified Endowment Contract, and advise you of your options. You should first consult a tax adviser and your Pruco Life of New Jersey representative if you are contemplating any of these steps.

•

If the Contract is classified as a Modified Endowment Contract, then amounts you receive under the Contract before the insured's death, including loans and withdrawals, are included in income to the extent that the Contract Fund before surrender charges exceeds the premiums paid for the Contract increased by the amount of any loans previously included in income and reduced by any untaxed amounts previously received other than the amount of any loans excludible from income. An assignment of a Modified Endowment Contract is taxable in the same way. These rules also apply to pre-death distributions, including loans and assignments, made during the two-year period before the time that the Contract became a Modified Endowment Contract.


•	Any taxable income on pre-death distributions (including full surrenders) is subject to a penalty of 10 percent unless the amount is received on or after age 59½, on account of your becoming disabled or as a life annuity. It is presently unclear how the penalty tax provisions apply to Contracts owned by businesses.


•	All Modified Endowment Contracts issued by us to you during the same calendar year are treated as a single Contract for purposes of applying these rules.

Investor Control. Treasury Department regulations do not provide specific guidance concerning the extent to which you may direct your investment in the particular Variable Investment Options without causing you, instead of us, to be considered the owner of the underlying assets. Because of this uncertainty, we reserve the right to make such changes as we deem necessary to assure that the Contract qualifies as life insurance for tax purposes. Any such changes will apply uniformly to affected Contract Owners and will be made with such notice to affected Contract Owners as is feasible under the circumstances.

Withholding. You must affirmatively elect that no taxes be withheld from a pre-death distribution. Otherwise, the taxable portion of any amounts you receive will be subject to withholding. You are not permitted to elect out of withholding if you do not provide a social security number or other taxpayer identification number. You may be subject to penalties under the estimated tax payment rules if your withholding and estimated tax payments are insufficient to cover the tax due.

Other Tax Considerations. If you transfer or assign the Contract to someone else, there may be gift, estate and/or income tax consequences. If you transfer the Contract to a person two or more generations younger than you (or designate such a younger person as a beneficiary), there may be Generation Skipping Transfer tax consequences. Deductions for interest paid or accrued on Contract Debt or on other loans that are incurred or continued to purchase or carry the Contract may be denied. Your individual situation or that of your beneficiary will determine the federal estate taxes and the state and local estate, inheritance and other taxes due if you or the insured dies.

BenefitAccess Rider. The benefits paid under the rider are intended to be treated as accelerated Death Benefits under the Internal Revenue Code Section 101(g)(1). Accelerated Benefit Payments due to Chronic Illness are subject to limits imposed by the federal government and any amounts received in excess of these limits are includable in gross income. Federal tax law requires that you receive a Recertification of Chronic Illness every 12 months to retain eligibility for income tax free treatment of benefits. The rider is not intended to be a qualified long term care insurance contract under section 7702B of the Internal Revenue Code nor is it intended to eliminate the need for insurance of these types. Any benefit received under the rider may impact the recipient’s eligibility for Medicaid or other government benefits. In some circumstances, accelerated benefits paid under the rider may be taxable as income. The exclusion from income tax for accelerated Death Benefits does not apply to any amounts paid to a Contract Owner other than the insured if the Contract Owner has an insurable interest with respect to the life of the insured by reason of the insured being an officer, employee or director of the Contract Owner or by reason of the insured being financially interested in any trade or business carried on by the Contract Owner. In addition, special rules apply to determine the taxability of benefits when there is more than one Contract providing accelerated benefits on account of Chronic Illness and/or other insurance policies on the insured that will pay similar benefits, and more than one Contract Owner. We do not provide tax advice. We advise you to seek the help of a professional tax adviser for assistance with any questions you may have.

Business-Owned Life Insurance. If a business, rather than an individual, is the owner of the Contract, there are some additional rules. Business Contract Owners generally cannot deduct premium payments. Business Contract Owners generally cannot take tax deductions for interest on Contract Debt paid or accrued after October 13, 1995. An exception permits the deduction of interest on Contract loans on Contracts for up to 20 key persons. The interest deduction for Contract Debt on these loans is limited to a prescribed interest rate and a maximum aggregate loan amount of $50,000 per key insured person. The corporate alternative minimum tax also applies to business-owned life insurance. This is an indirect tax on additions to the Contract Fund or Death Benefits received under business-owned life insurance policies.

For business-owned life insurance coverage issued after August 17, 2006, Death Benefits will generally be taxable as ordinary income to the extent it exceeds cost basis. Life insurance Death Benefits will continue to be generally income tax free if, prior to Contract issuance, the employer provided a prescribed notice to the proposed insured/employee, obtained the employee's consent to the life insurance, and one of the following requirements is met: (a) the insured was an employee at any time during the 12-month period prior to his or her death; (b) the insured was a director or highly compensated employee or individual (as defined in the Code) at the time the Contract was issued; or (c) the Death Benefits are paid to the insured's heirs or his or her designated beneficiaries (other than the

employer), either directly as a Death Benefit or received from the purchase of an equity (or capital or profits) interest in the applicable contract holder. Annual reporting and record keeping requirements will apply to employers maintaining such business-owned life insurance.

Sales of Issued Life Insurance Policies to Third Parties. Beginning in 2018, if you sell your Contract to a third party, such as a life settlement company, that purchaser is required to report the amount of the sales proceeds to us and the IRS. We are then required to report your cost basis in that Contract to you and the IRS.

Company Taxes

Under current law, we may incur state and local taxes (in addition to premium taxes) in several states. Currently, these taxes are not significant and they are not charged against the Account. If there is a material change in the applicable state or local tax laws, we may impose a corresponding charge against the Account.

We will pay company income taxes on the taxable corporate earnings created by this Contract from investments in the Separate Account assets. While we may consider company income taxes when pricing our products, we do not currently include such income taxes in the tax charges you pay under the Contract, other than the 0.75% charge for federal income taxes measured by premiums. See Premium-Based Administrative Charge. We will periodically review the issue of charging for these taxes, and we may charge for these taxes in the future. We reserve the right to impose a charge for federal income taxes if we determine, in our sole discretion, that we will incur a tax as a result of the operation of the Separate Account.

In calculating our corporate income tax liability, we may derive certain corporate income tax benefits associated with the investment of company assets, including Separate Account assets, which are treated as company assets under applicable income tax law. These benefits reduce our overall corporate income tax liability. Under current law, such benefits may include foreign tax credits and corporate dividend received deductions. We do not pass these tax benefits through to Contract Owners with investments in Separate Account assets because (i) the Contract Owners are not the owners of the assets generating these benefits under applicable income tax law and (ii) we do not currently include company income taxes in the tax charges you pay under the Contract.

DISTRIBUTION AND COMPENSATION

Pruco Securities, an indirect wholly-owned subsidiary of Prudential Financial, Inc., acts as the principal underwriter of the Contract. Pruco Securities, organized on September 22, 2003, under New Jersey law, is registered as a broker and dealer under the Securities Exchange Act of 1934 and is a registered member of the Financial Industry Regulatory Authority, Inc. (“FINRA”). (Pruco Securities is a successor company to Pruco Securities Corporation, established on February 22, 1971.) Pruco Securities’ principal business address is 751 Broad Street, Newark, New Jersey 07102. Pruco Securities serves as principal underwriter of the individual variable insurance Contracts issued by us. The Contract was sold by registered representatives of Pruco Securities who are also our appointed insurance agents under state insurance law. The Contract may have also been sold through other broker-dealers authorized by Pruco Securities and applicable law to do so. Pruco Securities received gross distribution revenue for its variable life insurance products of $187,214,104 in 2018, $120,592,554 in 2017, and $100,714,661 in 2016. Pruco Securities passes through the gross distribution revenue it receives to broker-dealers for their sales and does not retain any portion of it in return for its services as distributor for the Contracts. However, Pruco Securities does retain a portion of compensation it receives with respect to sales by its representatives. Pruco Securities retained compensation of $2,211,393 in 2018, $2,855,401 in 2017, and $2,574,216 in 2016. Pruco Securities offers the Contract on a continuous basis.

Compensation (commissions, overrides, and any expense reimbursement allowance) is paid to broker-dealers that are registered under the Exchange Act and/or entities that are exempt from such registration (“firms”) according to one or more schedules. The individual representative will receive all or a portion of the compensation, depending on the practice of the firm. Compensation is based on a premium value referred to as the Commissionable Target Premium. The Commissionable Target Premium is equal to the first year's surrender charge (which is found in your Contract Data pages) divided by the Percentage of Sales Load Target Premium at the start of year one from the table in the Surrender Charg e section of this prospectus. The Commissionable Target Premium will vary by issue age, sex, smoker/nonsmoker, substandard rating class, and any riders selected by the Contract Owner. For Type B Death Benefit Contracts, the Commissionable Target Premium, Sales Load Target Premium and Surrender Charge Target Premiums will vary from Contracts with Type A or Type C Death Benefit.

Broker-dealers will receive compensation of up to 99% of premiums received in the first 12 months following the Contract Date on total premiums received since issue up to the Commissionable Target Premium, up to 22% of Commissionable Target Premium received in year two, up to10% in years three and four, and up to 8.5% of the Commissionable Target Premium received in years five through 10. Moreover, broker-dealers will receive compensation of up to 4% on premiums received in year one, up to 3% on premiums received in years two through four, and up to 2.5% on premiums received in years five through 10 to the extent that premiums paid in any year exceed the Commissionable Target Premium.

Pruco Securities registered representatives who sell the Contract are also our life insurance agents, and may be eligible for various cash bonuses and insurance benefits and non-cash compensation programs that we or our affiliates offer such as conferences, trips, prizes , and awards, subject to applicable regulatory requirements. In some circumstances and to the extent permitted by applicable regulatory requirements, we may also reimburse certain sales and marketing expenses.

In addition, in an effort to promote the sale of our variable products (which may include the placement of our Contracts on a preferred or recommended company or product list and/or access to a broker-dealer’s registered representatives), we or Pruco Securities may enter into compensation arrangements with certain broker-dealer firms authorized by Pruco Securities to sell the Contract, or branches of such firms, with respect to certain or all registered representatives of such firms under which such firms may receive separate compensation or reimbursement for, among other things, training of sales personnel, marketing and/or administrative services, and/or other services they provide to us or our affiliates. To the extent permitted by applicable rules, laws, and regulations, Pruco Securities

may pay or allow other promotional incentives or payments in the form of cash or non-cash compensation. These arrangements may not be offered to all firms, and the terms of such arrangements may differ between firms. You should note that firms and individual registered representatives and branch managers within some firms participating in one of these compensation arrangements might receive greater compensation for selling the Contract than for selling a different Contract that is not eligible for these compensation arrangements.

A list of the names of the firms (or their affiliated broker/dealers) that we are aware of (as of December 31, 2018) that received payment or accrued a payment amount with respect to variable product business during 2018 may be found in the statement of additional information. The least amount paid or accrued and the greatest amount paid or accrued during 2018 were $3.00 and $11,285,643, respectively.

While compensation is generally taken into account as an expense in considering the charges applicable to a variable life insurance product, any such compensation will be paid by us, and will not result in any additional charge to you or to the Account. Your registered representative can provide you with more information about the compensation arrangements that apply upon the sale of the Contract.

In addition, we or our affiliates may provide compensati on, payments and/or incentives to firms arising out of the marketing, sale and/or servicing of variable annuities or life insurance offered by different Prudential business units.

LEGAL PROCEEDINGS

Pruco Life of New Jersey is subject to legal and regulatory actions in the ordinary course of our business. Pending legal and regulatory actions include proceedings specific to Pruco Life of New Jersey and proceedings generally applicable to business practices in the industry in which we operate. Pruco Life of New Jersey may be subject to class action lawsuits and other litigation involving a variety of issues and allegations involving sales practices, claims payments and procedures, premium charges, policy servicing and breach of fiduciary duty to customers. Pruco Life of New Jersey may also be subject to litigation arising out of its general business activities, such as its investments, contracts, leases , and labor and employment relationships, including claims of discrimination and harassment, and could be exposed to claims or litigation concerning certain business or process patents. In addition, Pruco Life of New Jersey, along with other participants in the businesses in which it engages, may be subject from time to time to investigations, examinations and inquiries, in some cases industry-wide, concerning issues or matters upon w hich regulat ors have determined to focus.

Pruco Life of New Jersey’s litigation and regulatory matters are subject to many uncertainties, and given their complexity and scope, their outcome cannot be predicted. In some of Pruco Life of New Jersey’s pending legal and regulatory actions, parties are seeking large and/or indeterminate amounts, including punitive or exemplary damages. It is possible that Pruco Life of New Jersey’s results of operations or cash flow in a particular quarterly or annual period could be materially affected by an ultimate unfavorable resolution of pending litigation and regulatory matters depending, in part, upon the results of operations or cash flow for such period. In light of the unpredictability of Pruco Life of New Jersey’s litigation and regulatory matters, it is also possible that in certain cases an ultimate unfavorable resolution of one or more pending litigation or regulatory matters could have a material adverse effect on Pruco Life of New Jersey’s financial position. Management believes, however, that, based on information currently known to it, the ultimate outcome of all pending litigation and regulatory matters, after consideration of applicable reserves and rights to indemnification, is not likely to have a material adverse effect o n the Account , the ability of Pruco Securities to perform its contract with the Account , or Pruco Life of New Jersey's ability to meet its obligations under the Contracts.

FINANCIAL STATEMENTS

Our audited consolidated financial statements are shown in the statement of additional information to this prospectus and should be considered only as bearing upon our ability to meet its obligations under the Contract.

The Account’s audited financial statements are available in the statement of additional information to this prospectus.

ADDITIONAL INFORMATION

We have filed a registration statement with the SEC under the Securities Act of 1933 relating to the offering described in this prospectus. This prospectus does not include all the information set forth in the registration statement. Certain portions have been omitted pursuant to the rules and regulations of the SEC. The omitted information may, however, be obtained from the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549, or by telephoning (202) 551-8090, upon payment of a prescribed fee.

To reduce costs, we now generally send only a single copy of prospectuses and shareholder reports to each household ("householding"), in lieu of sending a copy to each Contract Owner that resides in the household. You should be aware that you can revoke or "opt out" of householding at any time by calling 877-778-5008.

Pursuant to the delivery obligations under Section 5 of the Securities Act of 1933 and Rule 159 thereunder, Pruco Life of New Jersey delivers this prospectus to Contract Owners that reside outside of the United States. In addition, we may not market or offer benefits, features, or enhancements to prospective or current Contract Owners while outside of the United States.

You may contact us for further information at the address and telephone number inside the front cover of this prospectus. For service or questions about your Contract, please contact our Service Office at the phone number on the back cover or at P.O. Box 7390, Philadelphia, Pennsylvania 19176.

Cyber Security Risks

We provide more information about cyber security risks associated with this Contract in the statement of additional information.

DEFINITIONS OF SPECIAL TERMS USED IN THIS PROSPECTUS

Activities of Daily Living (ADLs) – refer to basic human functional abilities including:

1. Bathing - which means washing oneself by sponge bath or in either a tub or shower.

2. Continence - which means the ability to maintain control of bowel or bladder function or, when unable to maintain control of bowel or bladder function, the ability to perform associated personal hygiene, including caring for a catheter or colostomy bag.

3. Dressing - which means putting on and taking off all items of clothing and any necessary braces, fasteners or artificial limbs. Dressing does not include putting on or tying shoes.

4. Eating - which means feeding oneself by getting food into the body from a receptacle, such as a plate, cup, or table or by feeding tube or intravenously. Eating does not include preparing a meal.

5. Toileting - which means getting to and from the toilet, getting on and off the toilet, and performing associated personal hygiene.

6. Transferring - which means moving into or out of a bed, chair or wheelchair. Transferring does not include the task of getting into and out of the tub or shower.

Accumulated Net Payments – The actual premium payments you make, accumulated at an effective annual rate of 4%, less any withdrawals you make, also accumulated at an effective annual rate of 4%.

Attained Age – The insured's age on the Contract Date plus the number of years since then.

Basic Insurance Amount – The total amount of life insurance as shown in the Contract and no riders.

Benefit Payment – The periodic or lump sum payment of the accelerated benefit.

Benefit Period – Under the Chronic Illness Option of the BenefitAccess Rider, a period of time not to exceed twelve consecutive months.

Benefit Year – Under the Chronic Illness Option of the BenefitAccess Rider, a period of twelve months that begins on the Monthly Date on or following the date you have satisfied all conditions for eligibility, including Recertification. Subsequent Benefit Years will begin no earlier than the end of the current Benefit Year.

Cash Surrender Value – The amount payable to the Contract Owner upon surrender of the Contract. It is equal to the Contract Fund minus any Contract Debt and minus any applicable surrender charge. Also referred to in the Contract as “Net Cash Value.”

Chronically Ill – An insured has been certified by a Licensed Health Care Practitioner as the following:

1. being unable to perform (without Substantial Assistance from another individual) at least two Activities for Daily Living (“ADLs”) for a period of at least 90 days due to a loss of functional capacity; or

2. requiring substantial supervision from another individual to protect such individual from threats to health and safety due to a Severe Cognitive Impairment; and

3. needing services pursuant to a Licensed Health Care Practitioner’s Plan of Care as set forth in Written Certification or Re-certification; and

4. is not expected to recover from the Chronic Illness

Contract – The variable universal life insurance Contract described in this prospectus.

Contract Anniversary – The same date as the Contract Date in each later year.

Contract Date – The date the Contract is effective, as specified in the Contract.

Contract Debt – The principal amount of all outstanding loans plus any interest accrued thereon.

Contract Fund – The total amount credited to a specific Contract. On any date it is equal to the sum of the amounts in all the Variable Investment Options and the Fixed Rate Option, and the principal amount of any Contract Debt plus any interest earned thereon.

Contract Owner – You. Unless a different owner is named in the application, the owner of the Contract is the insured.

Contract Year – A year that starts on the Contract Date or on a Contract Anniversary.

Daily Benefit Limit Compound Rate – An interest rate used in conjunction with the Initial Daily Benefit Limit for determining the maximum monthly benefit payable under the Chronic Illness Option of the BenefitAccess Rider.

Death Benefit – If the Contract is not in default, this is the amount we will pay upon the death of the insured, assuming no Contract Debt.

Fixed Rate Option – An investment option under which interest is accrued daily at a rate that we declare periodically, but not less than an effective annual rate of 1%. Also referred to in the Contract as the fixed investment option.

Fund – Amounts you invest in a Variable Investment Option will be invested in a corresponding Fund of the same name. A Fund may also be called a "Portfolio."

Good Order – An instruction utilizing such forms, signatures, and dating as we require, which is sufficiently clear and complete and for which we do not need to exercise any discretion to follow such instructions.

Initial Daily Benefit Limit – The per diem limit in effect on the Contract Date and used in the calculation of the maximum monthly benefit payable under the Chronic Illness Option of the BenefitAccess Rider.

Licensed Health Care Practitioner – A physician, (as defined in section 1861(r)(1) of the Social Security Act) and any registered professional nurse, licensed social worker or other individual who meets such requirements as may be prescribed by the Secretary of Treasury, residing and practicing in the United States, legally authorized to practice medicine by the state in which he/she performs such function or action and who is acting within the scope of his/her license when he/she performs such function. May not be the insured, the Contract Owner, or a family member of the insured or Contract Owner.

Lifetime Benefit Amount – The maximum amount that can be accelerated during the lifetime of the insured under the Chronic Illness Option of the BenefitAccess Rider. For purposes of Benefit Payments, it is fixed at time of initial claim.

Limited No-Lapse Guarantee Premiums – Premiums that, if paid at the beginning of each Contract Year, will keep a Type A or a Contract with a Type B (variable) Death Benefit in force until the insured's Attained Age 75, or if later, during the first 10 Contract Years, regardless of investment performance and assuming no loans or withdrawals.

Maximum Monthly Benefit Payment – The maximum amount that may be paid to you on a monthly basis once a claim has been

approved under the Chronic Illness Option of the BenefitAccess Rider. This payment amount will be recalculated at the beginning of every Benefit Year.

Monthly Benefit Percent – The maximum allowable percentage of the Lifetime Benefit Amount that may be paid in a given month under the Chronic Illness Option of the BenefitAccess Rider.

Monthly Date – The Contract Date and the same date in each subsequent month.

Net Amount at Risk – The amount by which the Contract’s Death Benefit exceeds the Contract Fund. For example, if the Contract's Death Benefit is $500,000 and the Contract Fund is $100,000, the Net Amount at Risk is $400,000.

No-Lapse Guarantee – Sufficient premium payments, on an accumulated basis, will guarantee that your Contract will not lapse for a specified duration and a Death Benefit will be paid upon the death of the insured, regardless of investment experience and assuming no loans or withdrawals.

Payment Office – The office at which we process premium payments, loan payments, and payments to bring your Contract out of default. Your correspondence will be picked up at the address on your bill to which you are directed to send these payments and then delivered to our Payment Office. For items required to be sent to our Payment Office, your correspondence is not considered received by us until it is received at our Payment Office. Where this Prospectus refers to the day when we receive a premium payment, loan payment or a payment to bring your Contract out of default, we mean the day on which that item (or the last thing necessary for us to process that item) arrives in Good Order at our Payment Office. There are two main exceptions: if the item is received at our Payment Office (1) on a day that is not a business day or (2) after the close of a business day, then, in each case, we are deemed to have received that item on the next business day.

Plan of Care – A written plan for care designed especially for a Chronically Ill individual by a Licensed Health Care Practitioner. The Plan of Care should recommend the frequency and type of Services most suitable to meet the Chronically Ill individual’s need for substantial assistance or substantial supervision and the most appropriate type of providers for such Services.

Pruco Life Insurance Company of New Jersey – Pruco Life of New Jersey, us, we, our, or the Depositor. The company offering the Contract.

Recertification – Written documentation in a form satisfactory to us completed by a Licensed Health Care Practitioner, at your or the insured’s expense, certifying that the insured continues to meet all eligibility requirements. Recertification must be received prior to the start of each Benefit Year following the initial Benefit Year in order to continue receiving Benefit Payments under the Chronic Illness Option of the BenefitAccess Rider.

Sales Load Target Premium – A premium that is used to determine sales load and varies by the insured's issue age, sex, underwriting classification, as well as any riders selected by the Contract Owner.

Separate Account – Amounts under the Contract that are allocated to the Fund held by us in a Separate Account called the Pruco Life of New Jersey Variable Appreciable Account (the "Account" or the "Registrant"). The Separate Account is set apart from all of our general assets. Thus, such assets that are held in support of client accounts are not chargeable with liabilities arising out of any other business Pruco Life Insurance Company of New Jersey conducts.

Service Office – The office at which we process allocation change requests, withdrawal requests, surrender requests, transfer

requests, ownership change requests and assignment requests. Correspondence with our Service Office should be sent to P.O. Box 7390, Philadelphia, Pennsylvania 18176. Your correspondence will be picked up at this address and then delivered to our Service Office. For requests required to be sent to our Service Office, your request is not considered received by us until it is received at our Service Office. Where this Prospectus refers to the day when we receive a request from you, we mean the day on which that item (or the last thing necessary for us to process that item) arrives in Good Order at our Service Office or via the appropriate telephone number, fax number, or website if the item is a type we accept by those means. There are two main exceptions: if the request is received (1) on a day that is not a business day or (2) after the close of a business day, then, in each case, we are deemed to have received that item on the next business day.

Services – The necessary diagnostic, preventive, curing, treating, mitigating and rehabilitative services, and maintenance or personal care services which are required by a Chronically Ill individual and are provided pursuant to a Plan of Care prescribed by a Licensed Health Care Practitioner.

Severe Cognitive Impairment – A deficiency in a person’s short-term or long-term memory, orientation as to person, place, and time, deductive or abstract reasoning, or judgment as it relates to safety awareness, and that places the person at risk of harming himself/herself or others without substantial supervision.

Short Term No-Lapse Guarantee Premiums – Premiums that, if paid at the beginning of each Contract Year, will keep the Contract in force during the first eight Contract Years (six Contract Years for issue ages 60 and above), regardless of investment performance and assuming no loans or withdrawals.

Substantial Assistance – Hands-on assistance from another person without which an individual receiving such assistance would be unable to perform the Activity of Daily Living. Hands-on assistance means the direct physical assistance of another person.

Substantial Supervision – Requiring continual supervision by another person to protect the individual from threats to health or safety due to Severe Cognitive Impairment and may include cueing by verbal prompting, gestures, or other similar demonstrations.

Terminally Ill – The insured has a medical condition that is reasonably expected to result in the insured’s death within six months or less.

Valuation Period – The period of time from one determination of the value of the amount invested in a Variable Investment Option to the next. Such determinations are made when the net asset values of the Variable Investment Options are calculated, which would be as of the close of regular trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time).

Variable Investment Options – The investment options of the Account. When you choose a Variable Investment Option, we purchase shares of the Fund that corresponds to that option. We hold these shares in the Account.

Written Certification – Written documentation in a form satisfactory to us from a Licensed Health Care Practitioner, at your or the insured’s expense, certifying that the insured is Terminally Ill or Chronically Ill. Certification for a Chronically Ill insured must indicate whether the insured has a Plan of Care.

To Learn More About PruLife® Custom Premier II

The statement of additional information ("SAI") is legally a part of this prospectus, both of which are filed with the SEC under the Securities Act of 1933, Registration No. 333-112809. The SAI contains additional information about the Pruco Life of New Jersey Variable Appreciable Account. All of these filings can be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the public reference room may be obtained by calling the Commission at (202) 551-8090. The SEC also maintains a website (http://www.sec.gov) that contains the PruLife® Custom Premier II SAI, material incorporated by reference, and other information about us. Copies of these materials can also be obtained, upon payment of duplicating fees, from the SEC’s Public Reference Room, 100 F Street, N.E., Washington, D.C. 20549.

You can call us at 800-944-8786 to ask us questions, request information about the Contract, and obtain copies of the SAI, and personalized illustrations, without charge, or other documents. You can also view the SAI located with the prospectus at www.prudential.com/eprospectus, or request a copy by writing to us at:

Pruco Life Insurance Company of New Jersey

213 Washington Street

Newark, New Jersey 07102

Investment Company Act of 1940: Registration No. 811-03974

PART B:

INFORMATION REQUIRED IN THE STATEMENT OF ADDITIONAL INFORMATION

STATEMENT OF ADDITIONAL INFORMATION

The date of this statement of additional information and of the related prospectuses is May 1, 2019.

Pruco Life of New Jersey Variable Appreciable Account (the "Account")

Pruco Life Insurance Company of New Jersey

PruLife® Custom Premier II

VARIABLE UNIVERSAL LIFE INSURANCE CONTRACTS

This statement of additional information is not a prospectus. Please review the PruLife® Custom Premier II prospectus (the “prospectus”), which contains information concerning the Contracts described above. You may obtain a copy of the prospectus without charge by calling us at 800-944-8786. You can also view the statement of additional information located with the prospectus at www.prudential.com/eprospectus, or request a copy by writing to us.

The defined terms used in this statement of additional information are as defined in the prospectus.

Pruco Life Insurance Company of New Jersey

213 Washington Street

Newark, New Jersey 07102

TABLE OF CONTENTS



	Page
GENERAL INFORMATION AND HISTORY	1
Description of Pruco Life Insurance Company of New Jersey	1
Control of Pruco Life Insurance Company of New Jersey	1
State Regulation	1
Records	1
Services and Third Party Administration Agreements	1
Cyber Security	2
INITIAL PREMIUM PROCESSING	2
ADDITIONAL INFORMATION ABOUT OPERATION OF CONTRACTS	3
Legal Considerations Relating to Sex-Distinct Premiums and Benefits	3
Death Benefit	3
How a Type A (Fixed) Contract's Death Benefit Will Vary	3
How a Type B (Variable) Contract's Death Benefit Will Vary	4
How a Type C (Return of Premium) Contract’s Death Benefit Will Vary	5
Reports to Contract Owners	6
ADDITIONAL INFORMATION ABOUT CHARGES	6
Underwriting Procedures	6
ADDITIONAL INFORMATION ABOUT CONTRACTS IN DEFAULT	6
DISTRIBUTION AND COMPENSATION	6
EXPERTS	8
PERFORMANCE DATA	8
Average Annual Total Return	8
Non-Standard Total Return	8
Money Market Yield	9
FINANCIAL STATEMENTS	9

GENERAL INFORMATION AND HISTORY

Description of Pruco Life Insurance Company of New Jersey

Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey", “us”, “we”, or “our”) is a stock life insurance company founded on September 17, 1982, under the laws of the state of New Jersey. It is licensed to sell life insurance and annuities only in the states of New Jersey and New York.

Control of Pruco Life Insurance Company of New Jersey

Pruco Life of New Jersey is a wholly-owned subsidiary of Pruco Life Insurance Company (“Pruco Life”), which in turn is a wholly-owned subsidiary of The Prudential Insurance Company of America (“Prudential”), a stock life insurance company founded on October 13, 1875, under the laws of the state of New Jersey. Prudential is a wholly-owned subsidiary of Prudential Financial, Inc. (“Prudential Financial”), a New Jersey insurance holding company for financial services businesses offering wide range of insurance, investment management, and other financial products and services. The principal executive office of each of Prudential and Prudential Financial is Prudential Plaza, 751 Broad Street, Newark, New Jersey 07102.

As Pruco Life of New Jersey’s ultimate parent, Prudential Financial exercises significant influence over the operations and capital structure of Pruco Life of New Jersey, Pruco Life, and Prudential. However, neither Prudential Financial, Prudential, Pruco Life, nor any other related company has any legal responsibility to pay amounts that Pruco Life of New Jersey may owe under the Contract. Pruco Life of New Jersey and Pruco Life’s principal executive office is 213 Washington Street, Newark, New Jersey 07102.

State Regulation

Pruco Life of New Jersey is subject to regulation and supervision by the Department of Banking and Insurance of the State of New Jersey, which periodically examines its operations and financial condition. It is also subject to the insurance laws and regulations of all jurisdictions in which it is authorized to do business.

Pruco Life of New Jersey is required to submit annual statements of its operations, including financial statements, to the insurance departments of the various jurisdictions in which it does business to determine solvency and compliance with local insurance laws and regulations.

In addition to the annual statements referred to above, Pruco Life of New Jersey is required to file with New Jersey and other jurisdictions, a separate statement with respect to the operations of all of its variable contract accounts, in a form promulgated by the National Association of Insurance Commissioners.

Records

We maintain all records and accounts relating to the Account at our principal executive office. As presently required by the Investment Company Act of 1940, as amended, and regulations promulgated thereunder, reports containing such information as may be required under the Act or by any other applicable law or regulation will be sent to you semi-annually at your last address known to us.

Services and Third Party Administration Agreements

Pruco Life of New Jersey and Prudential have entered into a Service Agreement pursuant to which Prudential furnishes to Pruco Life of New Jersey various services, including preparation, maintenance, and filing of accounts, books, records, and other documents required under federal or state law, and various other accounting, administrative, and legal services, which are customarily performed by the officers and employees of Prudential. Pruco Life of New Jersey reimburses Prudential for its costs in providing such services. Under this Agreement, Pruco Life of New Jersey has reimbursed Prudential $18,416,108 in 2018, $18,772,784 in 2017, $16,925,435 in 2016, $14,159,949 in 2015, and $10,522,428 in 2014, of which the life business accounted for $7,457,040, $7,862,448, $7,037,114, $5,792,204, and $3,845,120, respectively.

Prudential furnishes Pruco Life of New Jersey the same administrative support services that it provides in the operation of its own business with regard to the payment of death claim proceeds by way of Prudential’s Alliance Account. As soon as the Pruco Life of New Jersey death claim is processed, the beneficiaries are furnished with an information kit that describes the settlement option and a check book on which they may write checks.

Our individual life reinsurance treaties covering PruLife® Custom Premier II Contracts provide for the reinsurance of a portion of the related mortality risk on a yearly renewable term basis. Pruco Life of New Jersey or its affiliates retain any such mortality risk that is not ceded under these treaties.

TransCentra, Inc. ("TransCentra") is a billing and payment services provider for Prudential, Pruco Life, and Pruco Life of New Jersey. TransCentra received $1,292,465 in 2018, $1,394,460 in 2017, and $1,507,087 in 2016 from Prudential for services rendered. TransCentra's principal business address is 4855 Peachtree Industrial Blvd, STE 245, Norcross, GA 30092.

Cyber Security

With the increasing use of technology and computer systems in general and, in particular, the internet to conduct necessary business functions, we are susceptible to operational, information security and related risks. These risks, which are often collectively referred to as “cyber security” risks, may include deliberate or malicious attacks, as well as unintentional events and occurrences. These risks are heightened by our offering of products with certain features, including those with automatic asset transfer or re-allocation strategies, and by our employment of complex investment, trading and hedging programs. Cyber security is generally defined as the technology, operations and related protocol surrounding and protecting a user’s computer hardware, network, systems and applications and the data transmitted and stored therewith. These measures ensure the reliability of a user’s systems, as well as the security, availability, integrity, and confidentiality of data assets.

Deliberate cyber attacks can include, but are not limited to, gaining unauthorized access (including physical break-ins and attempts to fraudulently induce employees, customers or other users of these systems to disclose sensitive information in order to gain access) to computer systems in order to misappropriate and/or disclose sensitive or confidential information; deleting, corrupting or modifying data; and causing operational disruptions. Cyber attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing denial-of-service attacks on websites (in order to prevent access to computer networks). In addition to deliberate breaches engineered by external actors, cyber security risks can also result from the conduct of malicious, exploited or careless insiders, whose actions may result in the destruction, release or disclosure of confidential or proprietary information stored on an organization’s systems.

Cyber security failures or breaches that could impact us and our Contract Owners, whether deliberate or unintentional, could arise not only in connection with our own administration of the Contract, but also with entities operating the Contract’s underlying funds and with third-party service providers to us. Cyber security failures originating with any of the entities involved with the offering and administration of the Contract may cause significant disruptions in the business operations related to the Contract. Potential impacts may include, but are not limited to, potential financial losses under the Contract, your inability to conduct transactions under the Contract and/or with respect to an underlying fund, an inability to calculate unit values with respect to the Contract and/or the net asset value (NAV) with respect to an underlying fund, and disclosures of your personal or confidential account information.

In addition to direct impacts to you, cyber security failures of the type described above may result in adverse impacts to us, including regulatory inquiries, regulatory proceedings, regulatory and/or legal and litigation costs, and reputational damage. Costs incurred by us may include reimbursement and other expenses, including the costs of litigation and litigation settlements and additional compliance costs. Considerable expenses also may be incurred by us in enhancing and upgrading computer systems and systems security following a cyber security failure.

The rapid proliferation of technologies, as well as the increased sophistication and activities of organized crime, hackers, terrorists, hostile foreign governments, and others continue to pose new and significant cyber security threats. Although we, our service providers, and the underlying funds offered under the Contract may have established business continuity plans and risk management systems to mitigate cyber security risks, there can be no guarantee or assurance that such plans or systems will be effective, or that all risks that exist, or may develop in the future, have been completely anticipated and identified or can be protected against. Furthermore, we cannot control or assure the efficacy of the cyber security plans and systems implemented by third-party service providers, the underlying funds, and the issuers in which the underlying funds invest.

INITIAL PREMIUM PROCESSING

In general, the invested portion of the minimum initial premium will be placed in the Contract Fund as of the later of the Contract Date and the date we receive the premium in Good Order.

Upon receipt of a request for life insurance from a prospective Contract Owner, Pruco Life of New Jersey will follow certain insurance underwriting (i.e., evaluation of risk) procedures designed to determine whether the proposed Insured is insurable. The process may involve such verification procedures as medical examinations and may require that further information be provided by the proposed Insured before a determination can be made. A Contract cannot be issued, (i.e., physically issued through Pruco Life of New Jersey’s computerized issue system) until this underwriting procedure has been completed.

Since a Contract cannot be issued until after the underwriting process has been completed, we use a Limited Insurance Agreement to provide temporary life insurance coverage to prospective Contract Owners who pay the minimum initial premium at the time the request for coverage is submitted. This coverage is for the total Death Benefit applied for, up to the maximum described by the Limited Insurance Agreement, and is subject to the other terms of the Limited Insurance Agreement.

The Contract Date is the date specified in the Contract. This date is used to determine the insurance age of the proposed insured. It represents the first day of the Contract Year and therefore determines the Contract Anniversary and Monthly Dates. It also represents the commencement of the suicide and contestable periods for purposes of the Basic Insurance Amount.

If the minimum initial premium is paid with the application and no medical examination is required, the Contract Date will ordinarily be the date of the application. If a delay is encountered (e.g., if a request for further information is not met promptly), generally,

the Contract Date will be 21 days prior to the date on which the Contract is physically issued. If a medical examination is required, the Contract Date will ordinarily be the date the examination is completed, subject to the same qualification as that noted above.

If the premium paid with the application is less than the minimum initial premium, the Contract Date will be determined as described above. The balance of the minimum initial premium amount will be applied as of the later of the Contract Date and the date premiums were received in Good Order.

If no premium is paid with the application, the Contract Date will be the Contract Date stated in the Contract, which will generally be the date the minimum initial premium is received in Good Order from the Contract Owner and the Contract is delivered.

There is one principal variation from the foregoing procedure. If permitted by the insurance laws of the state in which the Contract is issued, the Contract may be backdated up to six months.

In situations where the Contract Date precedes the date that the minimum initial premium is received, charges due prior to the initial premium receipt date will be deducted immediately after the net premium has been applied to the Contract Fund.

ADDITIONAL INFORMATION ABOUT OPERATION OF CONTRACTS

Legal Considerations Relating to Sex-Distinct Premiums and Benefits

The Contract generally employs mortality tables that distinguish between males and females. Thus, premiums and benefits differ under Contracts issued on males and females of the same age. However, in those states that have adopted regulations prohibiting sex-distinct insurance rates, premiums and cost of insurance charges will be based on male rates, whether the insureds are male or female. In addition, employers and employee organizations considering purchase of a Contract should consult their legal advisers to determine whether purchase of a Contract based on sex-distinct actuarial tables is consistent with Title VII of the Civil Rights Act of 1964 or other applicable law.

Death Benefit

There are three types of Death Benefit available under the Contract: (1) Type A, a generally fixed Death Benefit; (2) Type B, a variable Death Benefit; and (3) Type C, a return of premium Death Benefit. A Type C (return of premium) Death Benefit generally varies by the amount of premiums paid, a Type B (variable) Death Benefit varies with investment performance, and a Type A (fixed) Death Benefit does not vary unless it must be increased to comply with the Internal Revenue Code's definition of life insurance.

How a Type A (Fixed) Contract's Death Benefit Will Vary

Unde r the Type A (fixed) Contract, the Death Benefit is generally equal to the Basic Insurance Amount, before the reduction of any Contract Debt. If the Contract is kept in-force for several years, depending on how much premium you pay, and/or if investment performance is reasonably favorable, the Contract Fund may grow to the point where we will increase the Death Benefit in order to ensure that the Contract will satisfy the Internal Revenue Code's definition of life insurance.

Assuming no Contract Debt, the Death Benefit of a Type A (fixed) Contract will always be the greater of:


(1)	the Basic Insurance Amount; and


(2)	the Contract Fund before the deduction of any monthly charges due on that date, multiplied by the Attained Age factor that applies.

A listing of Attained Age factors can be found on your Contract's data pages. The latter provision ensures that the Contract will always have a Death Benefit large enough so that the Contract will be treated as life insurance for tax purposes under current law. Before the Contract is issued, the Contract owner may choose between two methods that we use to determine the tax treatment of the Contract.

The following table illustrates at different ages how the Attained Age factor affects the Death Benefit for different Contract Fund amounts. The table assumes a $250,000 Type A (fixed) Contract was issued when the insured was a male nonsmoker, age 35, and there is no Contract Debt.

Type A (Fixed) Death Benefit



If		Then
The insured is age	and the Contract Fund is	the Attained Age factor is**	the Contract Fund multiplied by the Attained Age factor is	and the Death Benefit is
40 40 40	$ 25,000 $ 75,000 $100,000	4.04 4.04 4.04	101,000 303,000 404,000	$250,000 $303,000* $404,000*



60 60 60	$ 75,000 $125,000 $150,000	2.11 2.11 2.11	158,250 263,750 316,500	$250,000 $263,750* $316,500*
80 80 80	$150,000 $200,000 $225,000	1.32 1.32 1.32	198,000 264,000 297,000	$250,000 $264,000* $297,000*
* Note that the Death Benefit has been increased to comply with the Internal Revenue Code’s definition of life insurance. ** Assumes the Contract owner selected the Cash Value Accumulation Test. These figures are based on the 2001 Commissioner's Standard Ordinary ("CSO") Mortality Tables.

This means, for example, that if the insured has reached the age of 60, and the Contract Fund is $150,000, the Death Benefit will be $316,500, even though the Basic Insurance Amount is $250,000. In this situation, for every $1 increase in the Contract Fund, the Death Benefit will be increased by $2.11. We reserve the right to refuse to accept any premium payment that increases the Death Benefit by more than it increases the Contract Fund. If we exercise this right, in certain situations it may result in the loss of the No-Lapse Guarantee.

How a Type B (Variable) Contract's Death Benefit Will Vary

Under the Type B (variable) Contract, while the Contract is in-force, the Death Benefit will never be less than the Basic Insurance Amount, before the reduction of any Contract Debt, but will also vary immediately after it is issued, with the investment results of the selected Variable Investment Options. The Death Benefit may be increased to ensure that the Contract will satisfy the Internal Revenue Code's definition of life insurance.

Assuming no Contract Debt, the Death Benefit of a Type B (variable) Contract will always be the greater of:


(1)	the Basic Insurance Amount plus the Contract Fund before the deduction of any monthly charges due on that date; and


(2)	the Contract Fund before the deduction of any monthly charges due on that date, multiplied by the Attained Age factor that applies.

For purposes of computing the Death Benefit, if the Contract Fund is less than zero, we will consider it to be zero. A listing of Attained Age factors can be found on your Contract's data pages. The latter provision ensures that the Contract will always have a Death Benefit large enough so that the Contract will be treated as life insurance for tax purposes under current law. Before the Contract is issued, the Contract owner may choose between two methods that we use to determine the tax treatment of the Contract.

The following table illustrates various Attained Age factors and Contract Funds and the corresponding Death Benefits. The table assumes a $250,000 Type B (variable) Contract was issued when the insured was a male nonsmoker, age 35, and there is no Contract Debt.

Type B (Variable) Death Benefit



If		Then
The insured is age	and the Contract Fund is	the Attained Age factor is**	the Contract Fund multiplied by the Attained Age factor is	and the Death Benefit is
40 40 40	$ 25,000 $ 75,000 $100,000	4.04 4.04 4.04	101,000 303,000 404,000	$275,000 $325,000 $404,000*
60 60 60	$ 75,000 $125,000 $150,000	2.11 2.11 2.11	158,250 263,750 316,500	$325,000 $375,000 $400,000
80 80 80	$150,000 $200,000 $225,000	1.32 1.32 1.32	198,000 264,000 297,000	$400,000 $450,000 $475,000



* Note that the Death Benefit has been increased to comply with the Internal Revenue Code’s definition of life insurance. ** Assumes the Contract owner selected the Cash Value Accumulation Test. These figures are based on the 2001 Commissioner's Standard Ordinary ("CSO") Mortality Tables.

This means, for example, that if the insured has reached the age of 40, and the Contract Fund is $100,000, the Death Benefit will be $404,000, even though the Basic Insurance Amount is $250,000. In this situation, for every $1 increase in the Contract Fund, the Death Benefit will be increased by $4.04. We reserve the right to refuse to accept any premium payment that increases the Death Benefit by more than it increases the Contract Fund. If we exercise this right, in certain situations it may result in the loss of the No-Lapse Guarantee.

How a Type C (Return of Premium) Contract’s Death Benefit Will Vary

Under the Type C (return of premium) Contract, while the Contract is in-force, the Death Benefit will vary by the amount of premiums paid, less any withdrawals.

The Death Benefit on a Type C Contract is limited to the Basic Insurance Amount plus an amount equal to: the Contract Fund plus the Type C Limiting Amount multiplied by the Type C Death Benefit Factor, both located in the Contract Limitations section of your Contract. The Death Benefit may be increased to ensure that the Contract will satisfy the Internal Revenue Code’s definition of life insurance. Unlike Type A and Type B Contracts, the Death Benefit of a Type C Contract may be less than the Basic Insurance Amount in the event total withdrawals are greater than total premiums paid.

Assuming no Contract Debt, the Death Benefit of a Type C (return of premium) Contract will always be the lesser of:


(1)	the Basic Insurance Amount plus the total premiums paid into the Contract less any withdrawals; and


(2)	the Basic Insurance Amount plus the Contract Fund before deduction of any monthly charges due on that date plus the product of the Type C Limiting Amount multiplied by the Type C Death Benefit Factor, both found in the Contract Limitations section of the Contract data pages.

However, if the product of the Contract Fund, before any monthly charges, multiplied by the Attained Age factor is greater than either (1) or (2), described above, then it will become the Death Benefit.

The following table illustrates various Attained Age factors and Contract Funds and the corresponding Death Benefits. The table assumes a $250,000 Type C (return of premium) Contract was issued when the insured was a male nonsmoker, age 35, and there is no Contract Debt.

Type C (Return of Premium) Death Benefit



If			Then
the insured is age	and the Contract Fund is	and the premium paid less any withdrawals is	the Attained Age factor is**	the Contract Fund multiplied by the Attained Age factor is	and the Death Benefit is
40 40 40	$25,000 $75,000 $100,000	$15,000 $60,000 $80,000	4.04 4.04 4.04	101,000 303,000 404,000	$265,000 $310,000 $404,000*
60 60 60	$75,000 $125,000 $150,000	$ 60,000 $100,000 $125,000	2.11 2.11 2.11	158,250 263,750 316,500	$310,000 $350,000 $375,000
80 80 80 80* 80*	$150,000 $200,000 $225,000 $250,000 $250,000	$125,000 $150,000 $175,000 $500,000 $600,000	1.32 1.32 1.32 1.32 1.32	198,000 264,000 297,000 330,000 330,000	$375,000 $400,000 $425,000 $750,000 $750,000



* Note that the Death Benefit has been increased to comply with the Internal Revenue Code’s definition of life insurance. Assumes the Contract owner selected the Cash Value Accumulation Test. These figures are based on the 2001 Commissioner's Standard Ordinary ("CSO") Mortality Tables. *Illustrates the effect of a Type C Benefit Factor = 1.

This means, for example, that if the insured has reached the age of 40, and the premiums paid less any withdrawals equals $80,000, the Death Benefit will be $404,000, even though the Basic Insurance Amount is $250,000. In this situation, for every $1 increase in the Contract Fund, the Death Benefit will be increased by $4.04. We reserve the right to refuse to accept any premium payment that increases the Death Benefit by more than it increases the Contract Fund. If we exercise this right, in certain situations it may result in the loss of the No-Lapse Guarantee.

Reports to Contract Owners

Once each year, we will send you a statement that provides certain information pertinent to your Contract. This statement will detail values, transactions made, and specific Contract data that apply only to your particular Contract.

We also make available annual and semi-annual reports of the Funds showing the financial condition of the Funds and the investments held in each Fund. The most recent annual and semi-annual reports are available at www.prudential.com/eprospectus or by calling 800-944-8786.

ADDITIONAL INFORMATION ABOUT CHARGES

Underwriting Procedures

When you express interest in obtaining a Contract from us, you may apply for coverage through either (1) a long form application or (2) our worksheet process. When using the long form application, a registered representative completes a full application and submits it to us to commence the underwriting process. A registered representative may be an agent/broker who is a representative of Pruco Securities, a broker-dealer affiliate of Prudential, or in some cases, a broker-dealer not directly affiliated with Prudential. When using the worksheet process, a registered representative typically collects enough information to start the underwriting process. The remaining information is obtained directly from the proposed insured.

Regardless of the underwriting process followed, once we receive the necessary information, which may include physicians' statements, medical examinations from physicians or paramedical vendors, test results, and other information, we will make a decision regarding our willingness to accept the risk, and the price at which we will accept the risk. We will issue the Contract when the risk has been accepted and priced.

Some requests for coverage that registered representatives submit through the worksheet process may qualify for accelerated underwriting. We will use information you provide on your application, information from third party information providers and other information to determine if we will accept the risk without a medical exam, which would otherwise be required. Depending on your circumstances, accelerated underwriting could affect our willingness to accept the risk. Also, this may result in lower or higher Contract costs since the information we collect may be different than what we collect for applications that do not use accelerated underwriting. Accelerated underwriting may not be available with the registered representative you select while other registered representatives may use it exclusively for eligible applications.

ADDITIONAL INFORMATION ABOUT CONTRACTS IN DEFAULT

When your Contract is in default, no part of your Contract Fund is available to you. Consequently, you are not able to take any loans, partial withdrawals or surrenders, or make any transfers among the investment options. In addition, during any period in which your Contract is in default, you may not change the way in which subsequent premiums are allocated or increase the amount of your insurance by increasing the Basic Insurance Amount of the Contract.

DISTRIBUTION AND COMPENSATION

In an effort to promote the sale of our variable products (which may include the placement of our Contracts on a preferred or recommended company or product list and/or access to a broker-dealer’s registered representatives), we or Pruco Securities may enter into compensation arrangements with certain broker-dealer firms authorized by Pruco Securities to sell the Contract, or branches of such firms, with respect to certain or all registered representatives of such firms under which such firms may receive separate compensation or reimbursement for, among other things, training of sales personnel, marketing and/or administrative services, and/or other services they provide to us or our affiliates. To the extent permitted by applicable rules, laws, and regulations, Pruco Securities may pay or allow other promotional incentives or payments in the form of cash or non-cash compensation. These arrangements may not be offered to all firms, and the terms of such arrangements may differ between firms. You should note that firms and individual registered representatives and branch managers within some firms participating in one of these compensation arrangements might receive greater compensation for selling the Contract than for selling a different Contract that is not eligible for these compensation arrangements.

Pruco Life of New Jersey makes these promotional payments directly to or in sponsorship of the firm (or its affiliated broker/dealers). Examples of arrangements under which such payments may be made currently include, but are not limited to, sponsorships, conferences (national, regional and top producer), speaker fees, promotional items and reimbursements to firms for marketing activities or services paid by the firms and/or their individual representatives. The amount of these payments varies widely because some payments may encompass only a single event, such as a conference, and others have a much broader scope.

The list below provides the names of the firms (or their affiliated broker/dealers) that we are aware of (as of December 31, 2018) that received payment or accrued a payment amount with respect to variable product business during 2018. The least amount paid or accrued and the greatest amount paid or accrued during 2018 were $3.00 and $11,285,643, respectively.

1ST GLOBAL CAPITAL CORPORATION, 1ST GLOBAL INS SVS INC, 1ST GLOBAL INSURANCE AGENCY OF MA INC, 3 MARK EQUITIES INC (J CLAY), AGENCY SERVICES OF AR INC, ALLSTATE FINANCIAL SERVICES LLC, AMERIAN GENERAL INS AGCY INC, AMERICAN EXPRESS INS AGENCY OF MA INC, AMERICAN EXPRESS INS AGENCY OF TX INC, AMERICAN INDEPENDENT SECURITIES GROUP LLC, AMERICAN INVESTORS CO, AMERICAN PORTFOLIOS FIN SVCS INC, AMERIPRISE FINANCIAL CENTER, AMERITAS INVESTMENT CORP, AON CONSULTING INC, APW CAPITAL INC, ARLINGTON SECURITIES INC, ARVEST INSURANCE INC, ASH BROKERAGE LLC, ASSOCIATED SECURITIES CORP, AURORA INSURANCE SERVICES INC, AUSDAL FINANCIAL PARTNERS INC, AVISEN SECURITIES INC, AXA NETWORK LLC, AYCO SERVICES AGENCY LP, AYCO SERVICES INS AGCY INC (K OSTER), BAIRD INSURANCE SERVICES INC, BBVA COMPASS INSURANCE AGENCY INC, BCG SECURITIES INC, BENEFIT FUNDING SERVICES LLC, BENJAMIN F EDWARDS & COMPANY INC, BERTHEL FISHER & CO FIN SVCS INC, BROKER DEALER FINANCIAL SERVICES, BROKERS INTERNATIONAL FINANCIAL SERVICES, BROOKLIGHT PLACE SECURITIES INC, CADARET GRANT & CO INC, CADARET GRANT INS AGENCY OF OHIO INC, CALTON & ASSOCIATES INC, CAMBRIDGE INVESTMENT RESEARCH INC, CAMBRIDGE INVESTMENT RESEARCH INC, CAPFINANCIAL SECURITIES LLC, CAPITAL FINANCIAL SERVICES INC, CAPITAL INVESTMENT GROUP INC (B LONG), CAPITAL SYNERGY PARTNERS INC, CAROLINAS INVESTMENT CONSULTING LLC, CBIZ BENEFITS & INS SVS INC, CC SERVICES INC, CENTARA CAPITAL SECURITIES INC, CENTAURUS FINANCIAL INC, CENTAURUS TEXAS INC, CENTERRE CAPITAL LLC, CES INSURANCE AGENCY INC, CETERA ADVISOR NETWORK LLC, CETERA ADVISOR NETWORKS INSURANCE SERVICES LLC, CETERA ADVISORS INSURANCE SERVICES LLC, CETERA ADVISORS LLC, CETERA FINANCIAL SPECIALIST LLC, CETERA INVESTMENT SERVICES LLC, CFD INVESTMENTS INC, CFS INSURANCE AND TECHNOLOGY SERV, CHALICE CAPITAL PARTNERS LLC, CHAPIN DAVIS INSURANCE INC, CHASE INSURANCE AGENCY, CIG RISK MANAGEMENT INC, CITIGROUP LIFE AGENCY LLC, CITIZENS SECURITIES INC, CLIENT ONE SECURITIES LLC, COMERICA INSURANCE SERVICES INC, COMMUNITYAMERICA FINANCIAL SOLUTIONS LLC, CONCORDE INSURANCE AGENCY INC, COORDINATED CAPITAL SECURITIES, CPS FINANCIAL & INSURANCE SERVICES IN, CROWN CAPITAL INS AGENCY OF NV INC, CROWN CAPITAL INSURANCE AGENCY LLC, CROWN CAPITAL SECURITIES LP, CRUMP LIFE INS SERVICES INC, CRUMP LIFE INS SERVICES INC, CURTIS INSURANCE LLC (E SEARFOSS), CUTTER & COMPANY BROKERAGE INC, DEMPSEY FIN NETWORK INC, DEMPSEY LORD SMITH LLC, DORSEY & COMPANY INC, EDWARD D JONES & CO LP, EDWARD JONES INS AGCY OF CA LLC, EDWARD JONES INS AGCY OF MA LLC, EDWARD JONES INS AGCY OF NM LLC, ENTERPRISE SECURITIES COMPANY, EQUITY SERVICES INC, EXECUTIVE INS AGENCY INC, FARMERS FINANCIAL SOLUTIONS, FASI OF TX INC, FBL MARKETING SERVICES LLC, FIFTH THIRD INSURANCE AGENCY INC, FIFTH THIRD SECURITIES INC, FINANCIAL TELESIS INC, FIRST ALLIED SECURITIES, FIRST CITIZENS INVESTOR SERVICES INC, FIRST DAKOTA INC, FIRST HEARTLAND CAPITAL INC, FIRST PALLADIUM LLC, FIRST STATE FINANCIAL MGMT INC, FNBB CAPITAL MARKETS LLC, FORESTERS EQUITY SERVICES INC, FORTUNE FINANCIAL SERVICES INC, FORTUNE SECURITIES INC, FOUNDERS FINANCIAL SECURITIES LLC, FSC AGENCY INC, FSC AGENCY INC, GENEOS WEALTH MANAGEMENT INC, GLOBALINK SECURITIES INC, GRADIENT SECURITIES LLC, GUARDIAN INV SVS CORP, GWN SECURITIES INC, H BECK INC, H D VEST INSURANCE AGENCY LLC, H&R BLOCK FINANCIAL ADVISORS INC, HANCOCK SECURITIES GROUP LLC, HANTZ AGENCY LLC, HANTZ AGENCY LLC, HANTZ FINANCIAL SERVICES INC, HARBOR FINANCIAL SERVICES LLC, HARBOR INVESTMENT ADVISORY LLC, HARBOUR INVESTMENTS INC, HAZLETT BURT AND WATSON INC, HEREFORD INSURANCE AGENCY INC, HEREFORD INSURANCE AGENCY INC, HIGHTOWER SECURITIES LLC, HORAN SECURITIES INC, HORNOR TOWNSEND & KENT, HUNTINGTON INVESTMENT COMPANY, HUNTLEIGH SECURITIES CORP (K JACKSON), HWG INS AGENCY INC, IBN FINANCIAL SERVICES INC, IFS SECURITIES INC, IMS INSURANCE AGENCY INC, INDEPENDENT FINANCIAL GROUP INC, INFINEX INVESTMENTS INC, INNOVATION PARTNERS LLC, INSIGHT SECURITIES INC, INTERCONTINENTAL AGENCY LLC, INTERLINK SECURITIES CORP, INTERNATIONAL ASSETS ADVISORY LLC, INTERSECURITIES INSURANCE AGENCY, INTERVEST INTERNAT'L EQUITIES CORP, INTERVEST INTERNATIONAL INC, INTERVEST INTERNATIONAL INC, INVERNESS SECURITIES LLC, INVEST FIN CORP INS AGCY INC OF IL, INVEST FINANCIAL CORPORATION, INVESTACORP INC, INVESTACORP INC, INVESTMENT CENTER INC, INVESTMENT PLANNERS INC, INVESTMENT PROFESSIONALS INC, INVESTORS SECURITY COMPANY INC, ISI INSURANCE AGENCY INC (R SIMARD), J J B HILLIARD W L LYONS LLC, J W COLE FINANCIAL INC, JANNEY MONTGOMERY SCOTT LLC, JJB HILLIARD W L LYONS INC, JK FINANCIAL SERVICES INC, JW COLE FINANCIAL INC, KCD FINANCIAL, KCG SECURITIES LLC, KCL SERVICE COMPANY OF TEXAS, KESTRA INVESTMENT SERVICES LLC, KEYCORP INSURANCE AGENCY USA INC, KFG ENTERPRISES INC, KINGSBURY CAPITAL INC, KMS FINANCIAL SERVICES, KOVACK SECURITIES INC, L M KOHN & CO, LARSON FINANCIAL GROUP LLC, LASALLE ST SECURITIES LLC, LEADERS GROUP, LEADERS GROUP INC, LFA LIMITED LIABILITY COMPANY, LIFEMARK SECURITIES CORP, LINCOLN FIN ADVISORS CORP, LINCOLN FINANCIAL SEC CORP, LINCOLN INVESTMENT PLANNING LLC, LINCOLN NATIONAL INS ASSOC INC, LINSCO PRIVATE LEDGER INS ASSOC INC, LION STREET FINANCIAL LLC, LPA INSURANCE AGENCY INC, LPL FINANCIAL CORPORATION, M HOLDINGS SECURITES INC, M-FINANCIAL SECURITIES MARKETING INC, M&T SECURITIES INC, MANNA CAPITAL MANAGEMENT, MARINER INSURANCE RESOURCES LLC, MARSH INSURANCE & INVESTMENTS CORP, MCG SECURITIES LLC, MCGRIFF INSURANCE SERVICES INC, MERCAP SECURITIES LLC, MERCER HEALTH & BENEFITS ADMINISTRATION LLC, MERRILL LYNCH LIFE AGCY INC, MERRILL LYNCH LIFE AGENCY, MERRILL LYNCH PIERCE FENNER AND SMITH, MML INS AGCY INC, MML INVESTORS SERVICES INC, MONEY CONCEPTS CAPITAL, MORGAN STANLEY DEAN WITTER INS SVCS INC, MSC OF TX INC, MUTUAL TRUST CO OF AMERICA SECURITIES, MWA FINANCIAL SERVICES INC, MWA FINANCIAL SERVICES INC, NATIONAL PLANNING CORP, NAVY FEDERAL BROKERAGE SERVICES LLC, NETWORK AGENCY INC, NETWORK AGENCY OF OHIO INC, NEW PENFACS INS AGENCY INC, NEWPORT GROUP SEC INC, NEXT FINANCIAL GROUP, NEXT FINANCIAL GROUP INC, NORTHLAND SECURITIES INC, NORTHWESTERN MUTUAL INVEST SVCS LLC, NPB FINANCIAL GROUP LLC, NPC INSURANCE AGENCY INC, NYLIFE INSURANCE AGENCY INC, O N EQUITY SALES COMPANY, OBS BROKERAGE SERVICES INC, OFG FINANCIAL SERVICES INC, OHIO NATIONAL INS AGENCY INC, OHIO NATIONAL INSURANCE AGENCY INC, ONEAMERICA SECURITIES INC, OPPENHEIMER & CO INC, PACKERLAND BROKERAGE SERVICES, PARK AVENUE SECURITIES, PARKLAND SECURITIES LLC, PARTNERS MKTG SVCS OF PA INC, PEOPLES SECURITIES INC, PLUS AGENCY LLC, PREFERRED MARKETING SERVICES INC (M ROTHSCHILD), PRINCIPAL SECURITIES INC, PRIVATE CLIENT SERVICES LLC, PRIVATE LEDGER INS AGCY OF OH INC (P CALFEE), PROEQUITIES INC, PRUDENTIAL DIRECT INC, PURSHE KAPLAN STERLING INS INV, QUEST CAPITAL STRATEGIES INC, QUESTAR AGENCY INC, QUESTAR CAPITAL CORPORATION, RAB AGENCY INC, RAYMOND JAMES &

ASSOCIATES INC, RAYMOND JAMES FINANCIAL SERVICES INC, RBC CAPITAL MARKETS CORP, REGULUS ADVISOR LLC, REHMANN INSURANCE GROUP LLC, ROBERT SHOR INSURANCE ASSOCIATES INC, ROBERT W BAIRD & CO INC, ROYAL ALLIANCE ASSOCIATES INC, ROYAL ALLIANCE ASSOCIATES INC, ROYAL ALLIANCE INS AGCY OF MA INC, ROYAL ALLIANCE INS AGCY OF OH INC (L WALLER), S B H U LIFE AGENCY INC, SA STONE WEALTH MANAGEMENT INC, SAGEPOINT FINANCIAL INC, SAXONY INSURANCE AGENCY LLC, SAYBRUS EQUITY SERVICES INC, SBS INSURANCE AGENCY OF FLORIDA INC, SBS INSURANCE AGENCY OF LA INC, SCF SECURITIES INC, SECURIAN FINANCIAL SERVICES INC, SECURITIES AMERICA INC, SECURITIES SERVICE NETWORK INC, SFA INSURANCE SERVICES INC, SIGMA FINANCIAL CORP, SIGNAL SECURITIES INC, SIGNATOR INSURANCE AGENCY, SII INSURANCE AGENCY INC, SII INVESTMENTS IN, SIMMONS FIRST INS SERVICES INC, SMITH BROWN & GROOVER INC, SORRENTO PACIFIC FINANCIAL LLC, SOUTHERN WEALTH SECURITIES LLC, SOUTHWEST INSURANCE AGENCY INC, SPIRE INSURANCE AGENCY LLC, STANLEY LAMAN GROUP SECURITIES LLC, STEPHENS INSURANCE LLC, STIFEL NICOLAUS & CO INC, STIFEL NICOLAUS & COMPANY INC, SUMMIT BROKERAGE SERVICES, INC., SUMMIT EQUITIES INC, SUNSET FINANCIAL SERVICES INC, SUPERIOR FINANCIAL SERVICES INC, TAYLOR CAPITAL MANAGEMENT INC, TFS SECURITIES INC, THOROUGHBRED FINANCIAL SERVICES LLC, THRIVENT INSURANCE AGENCY INC, THURSTON SPRINGER MILLER HERD & TITAK INC, TRANSAMERICA FINANCIAL ADVISORS, TRANSPACIFIC FNCL, TRG ADVISORS INC, TRIAD ADVISORS INC, TRIAD ADVISORS INC, TRUSTMONT FINANCIAL GROUP INC, UBS FINANCIAL SERVICES, UNIONBANC INVESTMENT SERVICES LLC, UNITED PLANNERS FINANCIAL, UNITED PLANNERS FINANCIAL SERVICES, UNIVEST INSURANCE INC, US BANCORP INSURANCE SERVICES LLC, US BANCORP INVESTMENTS INC, USA FINANCIAL SECURITIES CORP, VALMARK SECURITES INC, VANDERBILT SECURITIES LLC, VOYA INSURANCE SOLUTIONS INC, W & R INSURANCE AGENCY INC, W S GRIFFITH SEC INC (R PLYBON), WAYNE HUMMER INVESTMENTS LLC, WELLS FARGO ADVISORS CALIFORNIA INS AGEN, WELLS FARGO ADVISORS FINANCIAL NETWORK L, WELLS FARGO ADVISORS FINANCIAL NETWORK LLC, WELLS FARGO ADVISORS LLC, WESTERN EQUITY GROUP INC, WESTERN INTERNATIONAL SECURITIES INC, WINDHAM FINANCIAL SERVICES INC, WOODBURY FIN SERVICES INC, WOODBURY FINANCIAL AGENCY OH INC, WORLD CAPITAL BROKERAGE INC, WORLD EQUITY GROUP INC, WORTH FINANCIAL GROUP INC, ZURES CO FIN & INS SVCS (J BAKER)

Your registered representative can provide you with more information about the compensation arrangements that apply upon the sale of the Contract.

EXPERTS

The financial statements of Pruco Life Insurance Company of New Jersey as of December 31, 2018 and 2017, and for each of the three years in the period ended December 31, 2018 and the financial statements of Pruco Life of New Jersey Variable Appreciable Account as of December 31, 2018 and for each of the periods presented included in this Statement of Additional Information have been so included in reliance on the reports of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

Actuarial matters included in this statement of additional information have been examined by Vy Ho, FSA, MAAA, Vice President and Actuary of Prudential.

PERFORMANCE DATA

Average Annual Total Return

The Account may advertise average annual total return information calculated according to a formula prescribed by the SEC . Average annual total return shows the average annual percentage increase, or decrease, in the value of a hypothetical contribution allocated to a Variable Investment Option from the beginning to the end of each specified period of time. The SEC standardized version of this performance information is based on an assumed contribution of $1,000 allocated to a Variable Investment Option at the beginning of each period and full withdrawal of the value of that amount at the end of each specified period. This method of calculating performance further assumes that (i) a $1,000 contribution was allocated to a Variable Investment Option and (ii) no transfers or additional payments were made. Premium taxes are not included in the term “charges” for purposes of this calculation. Average annual total return is calculated by finding the average annual compounded rates of return of a hypothetical contribution that would compare the Unit Value on the first day of a specified period to the ending redeemable value at the end of the period according to the following formula:

P(1+T)ⁿ = ERV

Where T equals average annual total return, where ERV (the ending redeemable value) is the value at the end of the applicable period of a hypothetical contribution of $1,000 made at the beginning of the applicable period, where P equals a hypothetical contribution of $1,000, and where n equals the number of years.

Non-Standard Total Return

In addition to the standardized average annual total return information described above, we may present total return information computed on bases different from that standardized method. The Account may also present aggregate total return figures for various periods, reflecting the cumulative change in value of an investment in the Account for the specified period.

For the periods prior to the date the Variable Investment Option commenced operations, non-standard performance information for the Contracts will be calculated based on the performance of the Funds and the assumption that the Variable Investment Option were in existence for the same periods as those indicated for the Funds, with the level of Contract charges that were in effect at the inception of the Variable Investment Option (this is referred to as “hypothetical performance data”). Standard and non-standard average annual return calculations include the mortality and expense risk charge under the Contract, but do not reflect other life

insurance Contract charges (sales, administration, and actual cost of insurance) nor any applicable surrender or lapse charges, which would significantly lower the returns. Information stated for any given period does not indicate or represent future performance.

Money Market Yield

The “total return” figures for the Government Money Market Variable Investment Option are calculated using historical investment returns of the Government Money Market Portfolio of The Prudential Series Fund, Inc. as if PruLife® Custom Premier II had been investing in that Variable Investment Option during a specified period. Fees associated with the Series Fund are reflected; however, all fees, expenses, and charges associated with PruLife® Custom Premier II are not reflected.

The yield is computed by determining the net change, exclusive of capital changes, in the value of a hypothetical pre-existing account having a balance of one accumulation unit of the Government Money Market Variable Investment Option at the beginning of a specified period, subtracting a hypothetical charge reflecting deductions from Contract Owner accounts, and dividing the difference by the value of the Variable Investment Option at the beginning of the base period to obtain the base period return, and then multiplying the base period return by (365/7), with the resulting figure carried to the nearest ten-thousandth of 1%. The effective yield is obtained by taking the base period return, adding 1, raising the sum to a power equal to 365 divided by 7, and subtracting 1 from the result, according to the following formula: Effective Yield ([base period return + 1] ^365/7)-1.

The yields on amounts held in the Government Money Market Variable Investment Option will fluctuate on a daily basis. Therefore, the stated yields for any given period are not an indication of future yields.

FINANCIAL STATEMENTS

The financial statements of the Account should be distinguished from the financial statements of Pruco Life of New Jersey, which should be considered only as bearing upon the ability of Pruco Life of New Jersey to meet its obligations under the Contracts.

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	Prudential Government Money Market Portfolio		Prudential Diversified Bond Portfolio		Prudential Equity Portfolio (Class I)		Prudential Flexible Managed Portfolio		Prudential Conservative Balanced Portfolio
ASSETS
Investment in the portfolios, at fair value	$	9,560,580	$	137,564,961	$	208,707,903	$	302,260,280	$	134,693,896
Net Assets	$	9,560,580	$	137,564,961	$	208,707,903	$	302,260,280	$	134,693,896

NET ASSETS, representing:
Accumulation units	$	9,560,580	$	137,564,961	$	208,707,903	$	302,260,280	$	134,693,896
	$	9,560,580	$	137,564,961	$	208,707,903	$	302,260,280	$	134,693,896

Units outstanding	5,148,441		42,423,132		15,319,197		25,281,148		14,766,886

Portfolio shares held	956,058		10,485,134		4,257,607		10,557,467		5,082,789
Portfolio net asset value per share	$	10.00	$	13.12	$	49.02	$	28.63	$	26.50
Investment in portfolio shares, at cost	$	9,560,580	$	125,741,979	$	98,913,337	$	168,851,037	$	74,620,000

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential Government Money Market Portfolio		Prudential Diversified Bond Portfolio			Prudential Equity Portfolio (Class I)			Prudential Flexible Managed Portfolio			Prudential Conservative Balanced Portfolio
	1/1/2018		1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to		to			to			to			to
	12/31/2018		12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	149,272	$	—		$	—		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	43,033		389,255			1,365,010			2,044,077			899,378
Reimbursement for excess expenses	—		(9,298		)	(146,923		)	(654,710		)	(229,939		)
NET EXPENSES	43,033		379,957			1,218,087			1,389,367			669,439

NET INVESTMENT INCOME (LOSS)	106,239		(379,957		)	(1,218,087		)	(1,389,367		)	(669,439		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—		—			—			—			—
Net realized gain (loss) on shares redeemed	—		534,178			7,967,352			8,456,961			4,184,362
Net change in unrealized appreciation (depreciation) on investments	—		(791,030		)	(17,920,957		)	(21,436,165		)	(7,493,373		)
NET GAIN (LOSS) ON INVESTMENTS	—		(256,852		)	(9,953,605		)	(12,979,204		)	(3,309,011		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	106,239	$	(636,809	)	$	(11,171,692	)	$	(14,368,571	)	$	(3,978,450	)

The accompanying notes are an integral part of these financial statements.

A 1

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	Prudential High Yield Bond Portfolio		Prudential Stock Index Portfolio		Prudential Value Portfolio (Class I)		Prudential Natural Resources Portfolio (Class I)		Prudential Global Portfolio
ASSETS
Investment in the portfolios, at fair value	$	20,601,655	$	74,730,710	$	30,513,857	$	6,956,397	$	15,501,473
Net Assets	$	20,601,655	$	74,730,710	$	30,513,857	$	6,956,397	$	15,501,473

NET ASSETS, representing:
Accumulation units	$	20,601,655	$	74,730,710	$	30,513,857	$	6,956,397	$	15,501,473
	$	20,601,655	$	74,730,710	$	30,513,857	$	6,956,397	$	15,501,473

Units outstanding	4,532,763		14,894,641		2,656,934		714,030		4,784,892

Portfolio shares held	4,153,560		1,319,398		1,068,787		316,344		487,161
Portfolio net asset value per share	$	4.96	$	56.64	$	28.55	$	21.99	$	31.82
Investment in portfolio shares, at cost	$	20,801,986	$	52,665,674	$	21,374,907	$	9,579,813	$	10,200,659

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential High Yield Bond Portfolio			Prudential Stock Index Portfolio			Prudential Value Portfolio (Class I)			Prudential Natural Resources Portfolio (Class I)			Prudential Global Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	596,878		$	—		$	—		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	94,963			347,660			167,354			47,676			82,460
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	94,963			347,660			167,354			47,676			82,460

NET INVESTMENT INCOME (LOSS)	501,915			(347,660		)	(167,354		)	(47,676		)	(82,460		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	15,995			2,455,657			749,820			(190,805		)	555,901
Net change in unrealized appreciation (depreciation) on investments	(879,997		)	(5,932,288		)	(4,082,464		)	(1,372,276		)	(1,757,126		)
NET GAIN (LOSS) ON INVESTMENTS	(864,002		)	(3,476,631		)	(3,332,644		)	(1,563,081		)	(1,201,225		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(362,087	)	$	(3,824,291	)	$	(3,499,998	)	$	(1,610,757	)	$	(1,283,685	)

The accompanying notes are an integral part of these financial statements.

A 2

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	Prudential Government Income Portfolio		Prudential Jennison Portfolio (Class I)		Prudential Small Capitalization Stock Portfolio		T. Rowe Price International Stock Portfolio		Janus Henderson VIT Research Portfolio (Institutional Shares)
ASSETS
Investment in the portfolios, at fair value	$	2,500,902	$	49,362,907	$	16,013,931	$	33,431	$	417,828
Net Assets	$	2,500,902	$	49,362,907	$	16,013,931	$	33,431	$	417,828

NET ASSETS, representing:
Accumulation units	$	2,500,902	$	49,362,907	$	16,013,931	$	33,431	$	417,828
	$	2,500,902	$	49,362,907	$	16,013,931	$	33,431	$	417,828

Units outstanding	563,174		9,916,834		1,728,925		26,508		255,682

Portfolio shares held	196,921		806,452		455,588		2,564		12,398
Portfolio net asset value per share	$	12.70	$	61.21	$	35.15	$	13.04	$	33.70
Investment in portfolio shares, at cost	$	2,346,727	$	21,865,768	$	9,073,641	$	36,599	$	347,010

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential Government Income Portfolio			Prudential Jennison Portfolio (Class I)			Prudential Small Capitalization Stock Portfolio			T. Rowe Price International Stock Portfolio			Janus Henderson VIT Research Portfolio (Institutional Shares)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—		$	—		$	517		$	2,379

EXPENSES
Charges for mortality and expense risk, and
for administration	15,382			259,132			106,991			390			2,766
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	15,382			259,132			106,991			390			2,766

NET INVESTMENT INCOME (LOSS)	(15,382		)	(259,132		)	(106,991		)	127			(387		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			3,642			19,896
Net realized gain (loss) on shares redeemed	11,444			2,661,828			879,106			2,433			4,801
Net change in unrealized appreciation (depreciation) on investments	196			(2,855,838		)	(2,348,183		)	(12,102		)	(40,240		)
NET GAIN (LOSS) ON INVESTMENTS	11,640			(194,010		)	(1,469,077		)	(6,027		)	(15,543		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(3,742	)	$	(453,142	)	$	(1,576,068	)	$	(5,900	)	$	(15,930	)

The accompanying notes are an integral part of these financial statements.

A 3

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	MFS® Growth Series (Initial Class)		American Century VP Value Fund (Class I)		Franklin Small-Mid Cap Growth VIP Fund (Class 2)		Prudential SP Small Cap Value Portfolio (Class I)		Janus Henderson VIT Research Portfolio (Service Shares)
ASSETS
Investment in the portfolios, at fair value	$	190,609	$	392,582	$	322,569	$	11,695,597	$	1,692,334
Net Assets	$	190,609	$	392,582	$	322,569	$	11,695,597	$	1,692,334

NET ASSETS, representing:
Accumulation units	$	190,609	$	392,582	$	322,569	$	11,695,597	$	1,692,334
	$	190,609	$	392,582	$	322,569	$	11,695,597	$	1,692,334

Units outstanding	113,500		113,793		197,644		3,443,273		746,498

Portfolio shares held	4,055		39,219		21,194		515,452		51,486
Portfolio net asset value per share	$	47.01	$	10.01	$	15.22	$	22.69	$	32.87
Investment in portfolio shares, at cost	$	144,357	$	298,498	$	406,554	$	7,439,249	$	1,383,600

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	MFS® Growth Series (Initial Class)			American Century VP Value Fund (Class I)			Franklin Small-Mid Cap Growth VIP Fund (Class 2)			Prudential SP Small Cap Value Portfolio (Class I)			Janus Henderson VIT Research Portfolio (Service Shares)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	188		$	6,995		$	—		$	—		$	6,870

EXPENSES
Charges for mortality and expense risk, and
for administration	2,015			3,811			3,537			32,451			4,777
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	2,015			3,811			3,537			32,451			4,777

NET INVESTMENT INCOME (LOSS)	(1,827		)	3,184			(3,537		)	(32,451		)	2,093
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	13,918			26			43,072			—			94,179
Net realized gain (loss) on shares redeemed	53,873			9,611			(8,561		)	416,301			54,074
Net change in unrealized appreciation (depreciation) on investments	(57,756		)	(55,821		)	(49,246		)	(2,290,956		)	(199,320		)

NET GAIN (LOSS) ON INVESTMENTS	10,035			(46,184		)	(14,735		)	(1,874,655		)	(51,067		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	8,208		$	(43,000	)	$	(18,272	)	$	(1,907,106	)	$	(48,974	)

The accompanying notes are an integral part of these financial statements.

A 4

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	SP Prudential U.S. Emerging Growth Portfolio (Class I)		Prudential SP International Growth Portfolio (Class I)		Janus Henderson VIT Overseas Portfolio (Service Shares)		Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares)		M Large Cap Growth Fund
ASSETS
Investment in the portfolios, at fair value	$	14,354,041	$	4,106,138	$	527,321	$	93,876	$	103,000
Net Assets	$	14,354,041	$	4,106,138	$	527,321	$	93,876	$	103,000

NET ASSETS, representing:
Accumulation units	$	14,354,041	$	4,106,138	$	527,321	$	93,876	$	103,000
	$	14,354,041	$	4,106,138	$	527,321	$	93,876	$	103,000

Units outstanding	4,218,603		2,038,535		69,604		29,862		2,777

Portfolio shares held	1,053,121		585,754		20,566		9,053		4,508
Portfolio net asset value per share	$	13.63	$	7.01	$	25.64	$	10.37	$	22.85
Investment in portfolio shares, at cost	$	9,189,764	$	3,500,368	$	662,105	$	111,325	$	97,580

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	SP Prudential U.S. Emerging Growth Portfolio (Class I)			Prudential SP International Growth Portfolio (Class I)			Janus Henderson VIT Overseas Portfolio (Service Shares)			Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares)			M Large Cap Growth Fund
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—		$	10,186		$	522		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	39,867			12,231			610			221			—
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	39,867			12,231			610			221			—

NET INVESTMENT INCOME (LOSS)	(39,867		)	(12,231		)	9,576			301			—

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			15,643			12,177
Net realized gain (loss) on shares redeemed	851,268			120,886			(9,762		)	609			1,787
Net change in unrealized appreciation (depreciation) on investments	(2,037,713		)	(715,965		)	(96,303		)	(25,428		)	(19,528		)
NET GAIN (LOSS) ON INVESTMENTS	(1,186,445		)	(595,079		)	(106,065		)	(9,176		)	(5,564		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(1,226,312	)	$	(607,310	)	$	(96,489	)	$	(8,875	)	$	(5,564	)

The accompanying notes are an integral part of these financial statements.

A 5

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	M International Equity Fund		M Large Cap Value Fund		AST Cohen & Steers Realty Portfolio		AST J.P. Morgan Strategic Opportunities Portfolio		AST T. Rowe Price Large-Cap Value Portfolio
ASSETS
Investment in the portfolios, at fair value	$	11,452	$	114,522	$	1,342,549	$	1,543,168	$	916,008
Net Assets	$	11,452	$	114,522	$	1,342,549	$	1,543,168	$	916,008

NET ASSETS, representing:
Accumulation units	$	11,452	$	114,522	$	1,342,549	$	1,543,168	$	916,008
	$	11,452	$	114,522	$	1,342,549	$	1,543,168	$	916,008

Units outstanding	691		4,257		56,068		84,902		56,932

Portfolio shares held	1,080		10,355		121,828		85,070		67,009
Portfolio net asset value per share	$	10.60	$	11.06	$	11.02	$	18.14	$	13.67
Investment in portfolio shares, at cost	$	13,669	$	125,303	$	1,145,806	$	1,397,921	$	827,805

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	M International Equity Fund			M Large Cap Value Fund			AST Cohen & Steers Realty Portfolio			AST J.P. Morgan Strategic Opportunities Portfolio			AST T. Rowe Price Large-Cap Value Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	195		$	1,883		$	—		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	—			—			1,385			3,137			1,024
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	—			—			1,385			3,137			1,024

NET INVESTMENT INCOME (LOSS)	195			1,883			(1,385		)	(3,137		)	(1,024		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			9,279			—			—			—
Net realized gain (loss) on shares redeemed	27			921			39,615			10,877			15,187
Net change in unrealized appreciation (depreciation) on investments	(3,237		)	(27,684		)	(103,338		)	(92,356		)	(114,245		)
NET GAIN (LOSS) ON INVESTMENTS	(3,210		)	(17,484		)	(63,723		)	(81,479		)	(99,058		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(3,015	)	$	(15,601	)	$	(65,108	)	$	(84,616	)	$	(100,082	)

The accompanying notes are an integral part of these financial statements.

A 6

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	AST Small-Cap Growth Opportunities Portfolio		AST Small-Cap Value Portfolio		AST Goldman Sachs Mid-Cap Growth Portfolio		AST Loomis Sayles Large-Cap Growth Portfolio		AST MFS Growth Portfolio
ASSETS
Investment in the portfolios, at fair value	$	614,741	$	1,065,003	$	2,200,787	$	2,927,699	$	1,569,938
Net Assets	$	614,741	$	1,065,003	$	2,200,787	$	2,927,699	$	1,569,938

NET ASSETS, representing:
Accumulation units	$	614,741	$	1,065,003	$	2,200,787	$	2,927,699	$	1,569,938
	$	614,741	$	1,065,003	$	2,200,787	$	2,927,699	$	1,569,938

Units outstanding	23,825		45,082		119,958		128,506		80,265

Portfolio shares held	34,770		44,842		243,990		60,328		64,820
Portfolio net asset value per share	$	17.68	$	23.75	$	9.02	$	48.53	$	24.22
Investment in portfolio shares, at cost	$	482,621	$	953,270	$	1,996,914	$	1,806,640	$	1,330,589

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST Small-Cap Growth Opportunities Portfolio			AST Small-Cap Value Portfolio			AST Goldman Sachs Mid-Cap Growth Portfolio			AST Loomis Sayles Large-Cap Growth Portfolio			AST MFS Growth Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—		$	—		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	703			1,261			2,918			6,291			2,244
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	703			1,261			2,918			6,291			2,244

NET INVESTMENT INCOME (LOSS)	(703		)	(1,261		)	(2,918		)	(6,291		)	(2,244		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	20,737			87,160			26,094			99,327			30,815
Net change in unrealized appreciation (depreciation) on investments	(98,400		)	(301,426		)	(156,416		)	(187,645		)	(53,152		)
NET GAIN (LOSS) ON INVESTMENTS	(77,663		)	(214,266		)	(130,322		)	(88,318		)	(22,337		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(78,366	)	$	(215,527	)	$	(133,240	)	$	(94,609	)	$	(24,581	)

The accompanying notes are an integral part of these financial statements.

A 7

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	AST BlackRock Low Duration Bond Portfolio		AST T. Rowe Price Natural Resources Portfolio		AST MFS Global Equity Portfolio		AST J.P. Morgan International Equity Portfolio		AST Templeton Global Bond Portfolio
ASSETS
Investment in the portfolios, at fair value	$	750,654	$	1,455,314	$	1,291,533	$	1,451,656	$	799,227
Net Assets	$	750,654	$	1,455,314	$	1,291,533	$	1,451,656	$	799,227

NET ASSETS, representing:
Accumulation units	$	750,654	$	1,455,314	$	1,291,533	$	1,451,656	$	799,227
	$	750,654	$	1,455,314	$	1,291,533	$	1,451,656	$	799,227

Units outstanding	57,741		105,596		71,759		111,532		61,009

Portfolio shares held	69,377		75,522		69,587		57,107		71,232
Portfolio net asset value per share	$	10.82	$	19.27	$	18.56	$	25.42	$	11.22
Investment in portfolio shares, at cost	$	734,970	$	1,578,464	$	1,189,584	$	1,456,960	$	776,384

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST BlackRock Low Duration Bond Portfolio			AST T. Rowe Price Natural Resources Portfolio			AST MFS Global Equity Portfolio			AST J.P. Morgan International Equity Portfolio			AST Templeton Global Bond Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—		$	—		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	846			1,596			1,790			1,941			927
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	846			1,596			1,790			1,941			927

NET INVESTMENT INCOME (LOSS)	(846		)	(1,596		)	(1,790		)	(1,941		)	(927		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	1,041			11,467			29,212			12,528			1,491
Net change in unrealized appreciation (depreciation) on investments	4,259			(292,588		)	(159,754		)	(289,542		)	13,409
NET GAIN (LOSS) ON INVESTMENTS	5,300			(281,121		)	(130,542		)	(277,014		)	14,900

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	4,454		$	(282,717	)	$	(132,332	)	$	(278,955	)	$	13,973

The accompanying notes are an integral part of these financial statements.

A 8

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	M Capital Appreciation Fund		American Century VP Mid Cap Value Fund (Class I)		AST Hotchkis & Wiley Large-Cap Value Portfolio		AST Small-Cap Growth Portfolio		The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares)
ASSETS
Investment in the portfolios, at fair value	$	86,387	$	676,049	$	5,483,494	$	3,816,644	$	226,198
Net Assets	$	86,387	$	676,049	$	5,483,494	$	3,816,644	$	226,198

NET ASSETS, representing:
Accumulation units	$	86,387	$	676,049	$	5,483,494	$	3,816,644	$	226,198
	$	86,387	$	676,049	$	5,483,494	$	3,816,644	$	226,198

Units outstanding	2,366		27,776		344,138		156,552		11,597

Portfolio shares held	4,086		36,922		214,702		93,614		7,465
Portfolio net asset value per share	$	21.14	$	18.31	$	25.54	$	40.77	$	30.30
Investment in portfolio shares, at cost	$	107,326	$	727,759	$	3,944,730	$	2,464,543	$	268,120

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	M Capital Appreciation Fund			American Century VP Mid Cap Value Fund (Class I)			AST Hotchkis & Wiley Large-Cap Value Portfolio			AST Small-Cap Growth Portfolio			The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	306		$	10,357		$	—		$	—		$	3,558

EXPENSES
Charges for mortality and expense risk, and
for administration	—			734			13,928			9,352			271
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	—			734			13,928			9,352			271

NET INVESTMENT INCOME (LOSS)	306			9,623			(13,928		)	(9,352		)	3,287

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	18,723			42,590			—			—			44,217
Net realized gain (loss) on shares redeemed	600			4,310			206,858			277,670			(3,074		)
Net change in unrealized appreciation (depreciation) on investments	(33,974		)	(155,344		)	(1,097,973		)	(607,384		)	(56,128		)
NET GAIN (LOSS) ON INVESTMENTS	(14,651		)	(108,444		)	(891,115		)	(329,714		)	(14,985		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(14,345	)	$	(98,821	)	$	(905,043	)	$	(339,066	)	$	(11,698	)

The accompanying notes are an integral part of these financial statements.

A 9

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	Prudential Jennison 20/20 Focus Portfolio (Class I)		MFS® Utilities Series (Initial Class)		Neuberger Berman AMT Sustainable Equity Portfolio (Class S)		AST T. Rowe Price Large-Cap Growth Portfolio		AST BlackRock/Loomis Sayles Bond Portfolio
ASSETS
Investment in the portfolios, at fair value	$	1,943,343	$	1,702,366	$	149,750	$	7,120,155	$	9,313,984
Net Assets	$	1,943,343	$	1,702,366	$	149,750	$	7,120,155	$	9,313,984

NET ASSETS, representing:
Accumulation units	$	1,943,343	$	1,702,366	$	149,750	$	7,120,155	$	9,313,984
	$	1,943,343	$	1,702,366	$	149,750	$	7,120,155	$	9,313,984

Units outstanding	102,134		113,634		9,699		262,969		731,415

Portfolio shares held	65,831		57,943		6,571		197,837		687,379
Portfolio net asset value per share	$	29.52	$	29.38	$	22.79	$	35.99	$	13.55
Investment in portfolio shares, at cost	$	1,440,767	$	1,720,854	$	157,191	$	4,391,709	$	8,461,180

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential Jennison 20/20 Focus Portfolio (Class I)			MFS® Utilities Series (Initial Class)			Neuberger Berman AMT Sustainable Equity Portfolio (Class S)			AST T. Rowe Price Large-Cap Growth Portfolio			AST BlackRock/Loomis Sayles Bond Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	18,018		$	300		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	2,402			2,091			270			15,411			21,505
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	2,402			2,091			270			15,411			21,505

NET INVESTMENT INCOME (LOSS)	(2,402		)	15,927			30			(15,411		)	(21,505		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			6,256			7,801			—			—
Net realized gain (loss) on shares redeemed	90,225			(516		)	25,404			233,459			63,236
Net change in unrealized appreciation (depreciation) on investments	(202,043		)	(7,897		)	(35,359		)	(72,661		)	(124,799		)
NET GAIN (LOSS) ON INVESTMENTS	(111,818		)	(2,157		)	(2,154		)	160,798			(61,563		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(114,220	)	$	13,770		$	(2,124	)	$	145,387		$	(83,068	)

The accompanying notes are an integral part of these financial statements.

A 10

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	AST T. Rowe Price Asset Allocation Portfolio		AST Wellington Management Hedged Equity Portfolio		AST Balanced Asset Allocation Portfolio		AST Preservation Asset Allocation Portfolio		AST Fidelity Institutional AM℠ Quantitative Portfolio
ASSETS
Investment in the portfolios, at fair value	$	5,157,142	$	11,763,655	$	30,555,355	$	5,685,840	$	881,672
Net Assets	$	5,157,142	$	11,763,655	$	30,555,355	$	5,685,840	$	881,672

NET ASSETS, representing:
Accumulation units	$	5,157,142	$	11,763,655	$	30,555,355	$	5,685,840	$	881,672
	$	5,157,142	$	11,763,655	$	30,555,355	$	5,685,840	$	881,672

Units outstanding	226,359		685,209		1,685,239		359,406		43,341

Portfolio shares held	185,977		814,094		1,781,653		361,235		64,356
Portfolio net asset value per share	$	27.73	$	14.45	$	17.15	$	15.74	$	13.70
Investment in portfolio shares, at cost	$	4,501,036	$	8,783,538	$	23,386,785	$	4,599,181	$	827,961

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST T. Rowe Price Asset Allocation Portfolio			AST Wellington Management Hedged Equity Portfolio			AST Balanced Asset Allocation Portfolio			AST Preservation Asset Allocation Portfolio			AST Fidelity Institutional AM℠ Quantitative Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—		$	—		$	—		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	13,114			20,800			67,063			14,768			2,156
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	13,114			20,800			67,063			14,768			2,156

NET INVESTMENT INCOME (LOSS)	(13,114		)	(20,800		)	(67,063		)	(14,768		)	(2,156		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	75,470			370,458			530,399			226,136			12,592
Net change in unrealized appreciation (depreciation) on investments	(365,270		)	(1,006,465		)	(2,134,443		)	(392,551		)	(84,877		)
NET GAIN (LOSS) ON INVESTMENTS	(289,800		)	(636,007		)	(1,604,044		)	(166,415		)	(72,285		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(302,914	)	$	(656,807	)	$	(1,671,107	)	$	(181,183	)	$	(74,441	)

The accompanying notes are an integral part of these financial statements.

A 11

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	AST Prudential Growth Allocation Portfolio		AST Advanced Strategies Portfolio		AST RCM World Trends Portfolio		Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares)		AST BlackRock Global Strategies Portfolio
ASSETS
Investment in the portfolios, at fair value	$	7,579,733	$	1,738,805	$	1,009,606	$	151,108	$	37,554,135
Net Assets	$	7,579,733	$	1,738,805	$	1,009,606	$	151,108	$	37,554,135

NET ASSETS, representing:
Accumulation units	$	7,579,733	$	1,738,805	$	1,009,606	$	151,108	$	37,554,135
	$	7,579,733	$	1,738,805	$	1,009,606	$	151,108	$	37,554,135

Units outstanding	330,302		73,883		52,813		10,158		2,852,724

Portfolio shares held	494,438		97,961		74,675		9,043		2,827,872
Portfolio net asset value per share	$	15.33	$	17.75	$	13.52	$	16.71	$	13.28
Investment in portfolio shares, at cost	$	7,295,901	$	1,481,929	$	904,976	$	171,172	$	31,280,818

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST Prudential Growth Allocation Portfolio			AST Advanced Strategies Portfolio			AST RCM World Trends Portfolio			Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares)			AST BlackRock Global Strategies Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—		$	—		$	459		$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	17,975			4,531			2,579			209			72,089
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	17,975			4,531			2,579			209			72,089

NET INVESTMENT INCOME (LOSS)	(17,975		)	(4,531		)	(2,579		)	250			(72,089		)

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—			—			15,901			—
Net realized gain (loss) on shares redeemed	51,395			34,934			10,615			562			891,080
Net change in unrealized appreciation (depreciation) on investments	(705,160		)	(144,289		)	(95,254		)	(43,801		)	(2,971,567		)
NET GAIN (LOSS) ON INVESTMENTS	(653,765		)	(109,355		)	(84,639		)	(27,338		)	(2,080,487		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(671,740	)	$	(113,886	)	$	(87,218	)	$	(27,088	)	$	(2,152,576	)

The accompanying notes are an integral part of these financial statements.

A 12

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	TOPS® Aggressive Growth ETF Portfolio (Class 2)		TOPS® Balanced ETF Portfolio (Class 2)		TOPS® Conservative ETF Portfolio (Class 2)		TOPS® Growth ETF Portfolio (Class 2)		TOPS® Moderate Growth ETF Portfolio (Class 2)
ASSETS
Investment in the portfolios, at fair value	$	2,103,728	$	373,285	$	175,135	$	1,203,765	$	753,645
Net Assets	$	2,103,728	$	373,285	$	175,135	$	1,203,765	$	753,645

NET ASSETS, representing:
Accumulation units	$	2,103,728	$	373,285	$	175,135	$	1,203,765	$	753,645
	$	2,103,728	$	373,285	$	175,135	$	1,203,765	$	753,645

Units outstanding	153,184		30,183		15,306		98,031		63,703

Portfolio shares held	164,998		33,539		15,623		92,172		70,237
Portfolio net asset value per share	$	12.75	$	11.13	$	11.21	$	13.06	$	10.73
Investment in portfolio shares, at cost	$	2,332,432	$	392,075	$	182,062	$	1,348,805	$	743,906

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	TOPS® Aggressive Growth ETF Portfolio (Class 2)			TOPS® Balanced ETF Portfolio (Class 2)			TOPS® Conservative ETF Portfolio (Class 2)			TOPS® Growth ETF Portfolio (Class 2)			TOPS® Moderate Growth ETF Portfolio (Class 2)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	21,435		$	4,626		$	2,311		$	17,559		$	9,886

EXPENSES
Charges for mortality and expense risk, and
for administration	2,357			382			272			1,520			1,572
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	2,357			382			272			1,520			1,572

NET INVESTMENT INCOME (LOSS)	19,078			4,244			2,039			16,039			8,314

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	80,567			7,081			2,688			58,542			19,940
Net realized gain (loss) on shares redeemed	8,631			368			173			(8,888		)	7,303
Net change in unrealized appreciation (depreciation) on investments	(370,750		)	(34,552		)	(10,397		)	(212,568		)	(92,023		)
NET GAIN (LOSS) ON INVESTMENTS	(281,552		)	(27,103		)	(7,536		)	(162,914		)	(64,780		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(262,474	)	$	(22,859	)	$	(5,497	)	$	(146,875	)	$	(56,466	)

The accompanying notes are an integral part of these financial statements.

A 13

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	TOPS® Managed Risk Balanced ETF Portfolio (Class 2)		TOPS® Managed Risk Growth ETF Portfolio (Class 2)		TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2)		American Funds IS Growth Fund (Class 2)		American Funds IS Growth-Income Fund (Class 2)
ASSETS
Investment in the portfolios, at fair value	$	298,126	$	837,309	$	935,765	$	1,773,792	$	1,474,799
Net Assets	$	298,126	$	837,309	$	935,765	$	1,773,792	$	1,474,799

NET ASSETS, representing:
Accumulation units	$	298,126	$	837,309	$	935,765	$	1,773,792	$	1,474,799
	$	298,126	$	837,309	$	935,765	$	1,773,792	$	1,474,799

Units outstanding	23,932		64,957		72,025		117,369		97,856

Portfolio shares held	28,019		78,473		85,224		25,530		32,846
Portfolio net asset value per share	$	10.64	$	10.67	$	10.98	$	69.48	$	44.90
Investment in portfolio shares, at cost	$	320,291	$	893,203	$	982,394	$	1,946,066	$	1,572,124

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	TOPS® Managed Risk Balanced ETF Portfolio (Class 2)			TOPS® Managed Risk Growth ETF Portfolio (Class 2)			TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2)			American Funds IS Growth Fund (Class 2)			American Funds IS Growth-Income Fund (Class 2)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	5,176		$	13,353		$	15,996		$	7,324		$	20,596

EXPENSES
Charges for mortality and expense risk, and
for administration	682			2,085			2,325			2,571			2,689
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	682			2,085			2,325			2,571			2,689

NET INVESTMENT INCOME (LOSS)	4,494			11,268			13,671			4,753			17,907

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	16,078			47,209			46,673			128,137			82,847
Net realized gain (loss) on shares redeemed	1,355			4,059			5,874			1,945			7,266
Net change in unrealized appreciation (depreciation) on investments	(41,287		)	(141,616		)	(139,655		)	(223,559		)	(163,935		)
NET GAIN (LOSS) ON INVESTMENTS	(23,854		)	(90,348		)	(87,108		)	(93,477		)	(73,822		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(19,360	)	$	(79,080	)	$	(73,437	)	$	(88,724	)	$	(55,915	)

The accompanying notes are an integral part of these financial statements.

A 14

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	Fidelity® VIP Contrafund® Portfolio (Service Class 2)		Fidelity® VIP Mid Cap Portfolio (Service Class 2)		Templeton Growth VIP Fund (Class 2)		Hartford Capital Appreciation HLS Fund (Class IB)		Hartford Disciplined Equity HLS Fund (Class IB)
ASSETS
Investment in the portfolios, at fair value	$	1,044,864	$	1,240,275	$	93,109	$	22,838	$	85,102
Net Assets	$	1,044,864	$	1,240,275	$	93,109	$	22,838	$	85,102

NET ASSETS, representing:
Accumulation units	$	1,044,864	$	1,240,275	$	93,109	$	22,838	$	85,102
	$	1,044,864	$	1,240,275	$	93,109	$	22,838	$	85,102

Units outstanding	82,459		107,732		9,006		1,641		5,028

Portfolio shares held	33,372		42,446		7,626		581		6,332
Portfolio net asset value per share	$	31.31	$	29.22	$	12.21	$	39.28	$	13.44
Investment in portfolio shares, at cost	$	1,151,027	$	1,447,960	$	107,060	$	26,851	$	96,493

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	Fidelity® VIP Contrafund® Portfolio (Service Class 2)			Fidelity® VIP Mid Cap Portfolio (Service Class 2)			Templeton Growth VIP Fund (Class 2)			Hartford Capital Appreciation HLS Fund (Class IB)			Hartford Disciplined Equity HLS Fund (Class IB)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	4,303		$	4,985		$	1,381		$	163		$	458

EXPENSES
Charges for mortality and expense risk, and
for administration	1,837			2,062			115			20			88
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	1,837			2,062			115			20			88

NET INVESTMENT INCOME (LOSS)	2,466			2,923			1,266			143			370

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	50,784			63,068			5,848			2,336			8,707
Net realized gain (loss) on shares redeemed	855			1,195			(53		)	294			96
Net change in unrealized appreciation (depreciation) on investments	(143,846		)	(295,470		)	(20,319		)	(4,727		)	(11,979		)
NET GAIN (LOSS) ON INVESTMENTS	(92,207		)	(231,207		)	(14,524		)	(2,097		)	(3,176		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(89,741	)	$	(228,284	)	$	(13,258	)	$	(1,954	)	$	(2,806	)

The accompanying notes are an integral part of these financial statements.

A 15

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	Hartford Dividend and Growth HLS Fund (Class IB)		American Funds IS International Fund (Class 2)		Franklin Income VIP Fund (Class 2)		Franklin Mutual Shares VIP Fund (Class 2)		MFS® Total Return Bond Series (Initial Class)
ASSETS
Investment in the portfolios, at fair value	$	502,098	$	1,106,268	$	368,601	$	90,130	$	790,811
Net Assets	$	502,098	$	1,106,268	$	368,601	$	90,130	$	790,811

NET ASSETS, representing:
Accumulation units	$	502,098	$	1,106,268	$	368,601	$	90,130	$	790,811
	$	502,098	$	1,106,268	$	368,601	$	90,130	$	790,811

Units outstanding	32,499		102,817		31,793		8,282		72,976

Portfolio shares held	25,333		62,856		25,007		5,180		62,515
Portfolio net asset value per share	$	19.82	$	17.60	$	14.74	$	17.40	$	12.65
Investment in portfolio shares, at cost	$	583,522	$	1,259,729	$	385,855	$	104,582	$	822,682

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	Hartford Dividend and Growth HLS Fund (Class IB)			American Funds IS International Fund (Class 2)			Franklin Income VIP Fund (Class 2)			Franklin Mutual Shares VIP Fund (Class 2)			MFS® Total Return Bond Series (Initial Class)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	9,274		$	19,300		$	14,378		$	2,581		$	24,639

EXPENSES
Charges for mortality and expense risk, and
for administration	464			1,216			496			199			1,282
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	464			1,216			496			199			1,282

NET INVESTMENT INCOME (LOSS)	8,810			18,084			13,882			2,382			23,357

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	54,963			25,892			—			4,019			—
Net realized gain (loss) on shares redeemed	(385		)	517			594			(463		)	(1,819		)
Net change in unrealized appreciation (depreciation) on investments	(98,861		)	(189,920		)	(32,494		)	(15,849		)	(27,132		)
NET GAIN (LOSS) ON INVESTMENTS	(44,283		)	(163,511		)	(31,900		)	(12,293		)	(28,951		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(35,473	)	$	(145,427	)	$	(18,018	)	$	(9,911	)	$	(5,594	)

The accompanying notes are an integral part of these financial statements.

A 16

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	MFS® Value Series (Initial Class)		Hartford Growth Opportunities HLS Fund (Class IB)		American Funds IS Blue Chip Income and Growth Fund (Class 2)		Fidelity® VIP Index 500 Portfolio (Service Class 2)		Invesco V.I. Growth and Income Fund (Series I)
ASSETS
Investment in the portfolios, at fair value	$	518,092	$	418,901	$	436,932	$	1,469,590	$	417,985
Net Assets	$	518,092	$	418,901	$	436,932	$	1,469,590	$	417,985

NET ASSETS, representing:
Accumulation units	$	518,092	$	418,901	$	436,932	$	1,469,590	$	417,985
	$	518,092	$	418,901	$	436,932	$	1,469,590	$	417,985

Units outstanding	41,473		23,901		32,327		103,060		34,138

Portfolio shares held	29,948		13,013		35,697		5,890		23,871
Portfolio net asset value per share	$	17.30	$	32.19	$	12.24	$	249.51	$	17.51
Investment in portfolio shares, at cost	$	593,958	$	454,622	$	495,867	$	1,458,332	$	520,563

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	MFS® Value Series (Initial Class)			Hartford Growth Opportunities HLS Fund (Class IB)			American Funds IS Blue Chip Income and Growth Fund (Class 2)			Fidelity® VIP Index 500 Portfolio (Service Class 2)			Invesco V.I. Growth and Income Fund (Series I)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018
INVESTMENT INCOME
Dividend income	$	8,027		$	—		$	8,814		$	22,979		$	9,676

EXPENSES
Charges for mortality and expense risk, and
for administration	931			377			1,061			3,104			1,068
Reimbursement for excess expenses	—			—			—			—			—
NET EXPENSES	931			377			1,061			3,104			1,068

NET INVESTMENT INCOME (LOSS)	7,096			(377		)	7,753			19,875			8,608

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	34,949			54,904			32,968			5,621			44,102
Net realized gain (loss) on shares redeemed	291			6,112			470			5,699			74
Net change in unrealized appreciation (depreciation) on investments	(98,699		)	(68,747		)	(82,751		)	(125,865		)	(119,809		)
NET GAIN (LOSS) ON INVESTMENTS	(63,459		)	(7,731		)	(49,313		)	(114,545		)	(75,633		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(56,363	)	$	(8,108	)	$	(41,560	)	$	(94,670	)	$	(67,025	)

The accompanying notes are an integral part of these financial statements.

A 17

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF NET ASSETS

December 31, 2018



	SUBACCOUNTS
	AST International Value Portfolio		Calvert VP NASDAQ 100 Index Portfolio (Class F)		Calvert VP S&P MidCap 400 Index Portfolio (Class F)
ASSETS
Investment in the portfolios, at fair value	$	3,834,270	$	18	$	32
Net Assets	$	3,834,270	$	18	$	32

NET ASSETS, representing:
Accumulation units	$	3,834,270	$	18	$	32
	$	3,834,270	$	18	$	32

Units outstanding	406,552		2		4

Portfolio shares held	214,445		— ⁽¹⁾		— ⁽¹⁾
Portfolio net asset value per share	$	17.88	$	63.40	$	97.70
Investment in portfolio shares, at cost	$	4,042,294	$	17	$	32

⁽¹⁾Amount is less than 1 share.

STATEMENTS OF OPERATIONS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST International Value Portfolio			Calvert VP NASDAQ 100 Index Portfolio (Class F)		Calvert VP S&P MidCap 400 Index Portfolio (Class F)
	1/1/2018			8/20/2018*		8/20/2018*
	to			to		to
	12/31/2018			12/31/2018		12/31/2018
INVESTMENT INCOME
Dividend income	$	—		$	—	$	—

EXPENSES
Charges for mortality and expense risk, and
for administration	14,735			—		—
Reimbursement for excess expenses	—			—		—
NET EXPENSES	14,735			—		—

NET INVESTMENT INCOME (LOSS)	(14,735		)	—		—

NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Capital gains distributions received	—			—		—
Net realized gain (loss) on shares redeemed	69,735			—		—
Net change in unrealized appreciation (depreciation) on investments	(839,514		)	1		—
NET GAIN (LOSS) ON INVESTMENTS	(769,779		)	1		—

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	$	(784,514	)	$	1	$	—

* Date subaccount became available for investment.

The accompanying notes are an integral part of these financial statements.

A 18

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential Government Money Market Portfolio			Prudential Diversified Bond Portfolio			Prudential Equity Portfolio (Class I)			Prudential Flexible Managed Portfolio			Prudential Conservative Balanced Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	106,239		$	(379,957	)	$	(1,218,087	)	$	(1,389,367	)	$	(669,439	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	—			534,178			7,967,352			8,456,961			4,184,362
Net change in unrealized appreciation (depreciation) on investments	—			(791,030		)	(17,920,957		)	(21,436,165		)	(7,493,373		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	106,239			(636,809		)	(11,171,692		)	(14,368,571		)	(3,978,450		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	23,634,298			1,851,072			4,472,455			7,847,336			4,076,009
Policy loans	(169,733		)	(626,081		)	(2,935,247		)	(3,348,408		)	(1,370,606		)
Policy loan repayments and interest	100,738			473,252			3,046,257			4,158,309			1,603,670
Surrenders, withdrawals and death benefits	(747,723		)	(2,608,068		)	(11,161,083		)	(16,235,000		)	(7,539,871		)
Net transfers between other subaccounts
or fixed rate option	(22,288,336		)	578,724			(626,630		)	(855,764		)	(878,718		)
Miscellaneous transactions	8,083			(3,715		)	15,654			36,358			3,406
Other charges	(892,357		)	(2,159,112		)	(3,996,881		)	(6,209,848		)	(3,065,724		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(355,030		)	(2,493,928		)	(11,185,475		)	(14,607,017		)	(7,171,834		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	(248,791		)	(3,130,737		)	(22,357,167		)	(28,975,588		)	(11,150,284		)

NET ASSETS
Beginning of period	9,809,371			140,695,698			231,065,070			331,235,868			145,844,180
End of period	$	9,560,580		$	137,564,961		$	208,707,903		$	302,260,280		$	134,693,896

Beginning units	5,362,936			43,339,793			15,899,639			26,420,702			15,662,103
Units issued	4,557,489			522,118			302,637			168,161			269,701
Units redeemed	(4,771,984		)	(1,438,779		)	(883,079		)	(1,307,715		)	(1,164,918		)
Ending units	5,148,441			42,423,132			15,319,197			25,281,148			14,766,886

The accompanying notes are an integral part of these financial statements.

A 19

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential High Yield Bond Portfolio			Prudential Stock Index Portfolio			Prudential Value Portfolio (Class I)			Prudential Natural Resources Portfolio (Class I)			Prudential Global Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	501,915		$	(347,660	)	$	(167,354	)	$	(47,676	)	$	(82,460	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	15,995			2,455,657			749,820			(190,805		)	555,901
Net change in unrealized appreciation (depreciation) on investments	(879,997		)	(5,932,288		)	(4,082,464		)	(1,372,276		)	(1,757,126		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(362,087		)	(3,824,291		)	(3,499,998		)	(1,610,757		)	(1,283,685		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	973,538			3,137,194			1,021,356			451,136			639,230
Policy loans	(276,575		)	(1,251,390		)	(417,785		)	(163,827		)	(331,899		)
Policy loan repayments and interest	208,397			954,074			350,269			148,792			246,520
Surrenders, withdrawals and death benefits	(745,278		)	(4,544,408		)	(1,363,052		)	(532,646		)	(784,390		)
Net transfers between other subaccounts
or fixed rate option	350,160			2,437,653			115,391			(459,430		)	156,527
Miscellaneous transactions	8,079			(11,640		)	3,112			3,408			(372		)
Other charges	(633,164		)	(2,028,806		)	(749,669		)	(253,921		)	(395,547		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(114,843		)	(1,307,323		)	(1,040,378		)	(806,488		)	(469,931		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	(476,930		)	(5,131,614		)	(4,540,376		)	(2,417,245		)	(1,753,616		)

NET ASSETS
Beginning of period	21,078,585			79,862,324			35,054,233			9,373,642			17,255,089
End of period	$	20,601,655		$	74,730,710		$	30,513,857		$	6,956,397		$	15,501,473

Beginning units	4,549,484			15,622,353			2,720,141			770,430			4,939,457
Units issued	1,898,343			699,002			68,944			33,866			223,488
Units redeemed	(1,915,064		)	(1,426,714		)	(132,151		)	(90,266		)	(378,053		)
Ending units	4,532,763			14,894,641			2,656,934			714,030			4,784,892

The accompanying notes are an integral part of these financial statements.

A 20

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential Government Income Portfolio			Prudential Jennison Portfolio (Class I)			Prudential Small Capitalization Stock Portfolio			T. Rowe Price International Stock Portfolio			Janus Henderson VIT Research Portfolio (Institutional Shares)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(15,382	)	$	(259,132	)	$	(106,991	)	$	127		$	(387	)
Capital gains distributions received	—			—			—			3,642			19,896
Net realized gain (loss) on shares redeemed	11,444			2,661,828			879,106			2,433			4,801
Net change in unrealized appreciation (depreciation) on investments	196			(2,855,838		)	(2,348,183		)	(12,102		)	(40,240		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(3,742		)	(453,142		)	(1,576,068		)	(5,900		)	(15,930		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	98,437			1,696,595			487,384			304			5,549
Policy loans	(31,381		)	(1,048,393		)	(380,906		)	—			—
Policy loan repayments and interest	36,780			652,198			172,633			—			—
Surrenders, withdrawals and death benefits	(161,593		)	(3,056,582		)	(1,004,266		)	(13,343		)	(3,675		)
Net transfers between other subaccounts
or fixed rate option	(90,642		)	1,089,473			221,879			—			43,584
Miscellaneous transactions	49			(17,419		)	(1,918		)	122			18
Other charges	(68,341		)	(1,159,213		)	(366,712		)	(802		)	(11,025		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(216,691		)	(1,843,341		)	(871,906		)	(13,719		)	34,451

TOTAL INCREASE (DECREASE) IN NET ASSETS	(220,433		)	(2,296,483		)	(2,447,974		)	(19,619		)	18,521

NET ASSETS
Beginning of period	2,721,335			51,659,390			18,461,905			53,050			399,307
End of period	$	2,500,902		$	49,362,907		$	16,013,931		$	33,431		$	417,828

Beginning units	613,013			10,251,942			1,818,459			35,765			234,378
Units issued	14,110			386,892			55,275			202			29,445
Units redeemed	(63,949		)	(722,000		)	(144,809		)	(9,459		)	(8,141		)
Ending units	563,174			9,916,834			1,728,925			26,508			255,682

The accompanying notes are an integral part of these financial statements.

A 21

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	MFS® Growth Series (Initial Class)			American Century VP Value Fund (Class I)			Franklin Small-Mid Cap Growth VIP Fund (Class 2)			Prudential SP Small Cap Value Portfolio (Class I)			Janus Henderson VIT Research Portfolio (Service Shares)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(1,827	)	$	3,184		$	(3,537	)	$	(32,451	)	$	2,093
Capital gains distributions received	13,918			26			43,072			—			94,179
Net realized gain (loss) on shares redeemed	53,873			9,611			(8,561		)	416,301			54,074
Net change in unrealized appreciation (depreciation) on investments	(57,756		)	(55,821		)	(49,246		)	(2,290,956		)	(199,320		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	8,208			(43,000		)	(18,272		)	(1,907,106		)	(48,974		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	4,187			3,183			2,327			963,712			94,593
Policy loans	(7,925		)	—			—			(279,228		)	(95,858		)
Policy loan repayments and interest	908			—			—			136,504			46,987
Surrenders, withdrawals and death benefits	(103,095		)	(14,448		)	—			(559,210		)	(88,629		)
Net transfers between other subaccounts
or fixed rate option	43,583			43,583			(58,844		)	450,552			(9,809		)
Miscellaneous transactions	(34		)	43			20			782			84
Other charges	(1,331		)	(8,980		)	(7,880		)	(517,444		)	(47,161		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(63,707		)	23,381			(64,377		)	195,668			(99,793		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	(55,499		)	(19,619		)	(82,649		)	(1,711,438		)	(148,767		)

NET ASSETS
Beginning of period	246,108			412,201			405,218			13,407,035			1,841,101
End of period	$	190,609		$	392,582		$	322,569		$	11,695,597		$	1,692,334

Beginning units	149,110			107,573			232,846			3,467,379			787,091
Units issued	26,099			12,294			1,235			201,813			38,297
Units redeemed	(61,709		)	(6,074		)	(36,437		)	(225,919		)	(78,890		)
Ending units	113,500			113,793			197,644			3,443,273			746,498

The accompanying notes are an integral part of these financial statements.

A 22

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	SP Prudential U.S. Emerging Growth Portfolio (Class I)			Prudential SP International Growth Portfolio (Class I)			Janus Henderson VIT Overseas Portfolio (Service Shares)			Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares)			M Large Cap Growth Fund
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(39,867	)	$	(12,231	)	$	9,576		$	301		$	—
Capital gains distributions received	—			—			—			15,643			12,177
Net realized gain (loss) on shares redeemed	851,268			120,886			(9,762		)	609			1,787
Net change in unrealized appreciation (depreciation) on investments	(2,037,713		)	(715,965		)	(96,303		)	(25,428		)	(19,528		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(1,226,312		)	(607,310		)	(96,489		)	(8,875		)	(5,564		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	917,363			418,364			125,423			2,148			9,285
Policy loans	(471,777		)	(139,914		)	(11,136		)	—			—
Policy loan repayments and interest	156,293			47,391			3,066			—			—
Surrenders, withdrawals and death benefits	(968,912		)	(123,005		)	(29,518		)	(2,410		)	—
Net transfers between other subaccounts
or fixed rate option	89,717			9,505			(37,375		)	—			—
Miscellaneous transactions	4,352			454			56			—			—
Other charges	(508,133		)	(191,745		)	(46,829		)	(1,306		)	(8,126		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(781,097		)	21,050			3,687			(1,568		)	1,159

TOTAL INCREASE (DECREASE) IN NET ASSETS	(2,007,409		)	(586,260		)	(92,802		)	(10,443		)	(4,405		)

NET ASSETS
Beginning of period	16,361,450			4,692,398			620,123			104,319			107,405
End of period	$	14,354,041		$	4,106,138		$	527,321		$	93,876		$	103,000

Beginning units	4,451,258			2,035,143			69,398			30,263			2,753
Units issued	250,579			191,334			12,270			548			211
Units redeemed	(483,234		)	(187,942		)	(12,064		)	(949		)	(187		)
Ending units	4,218,603			2,038,535			69,604			29,862			2,777

The accompanying notes are an integral part of these financial statements.

A 23

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	M International Equity Fund			M Large Cap Value Fund			AST Cohen & Steers Realty Portfolio			AST J.P. Morgan Strategic Opportunities Portfolio			AST T. Rowe Price Large-Cap Value Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	195		$	1,883		$	(1,385	)	$	(3,137	)	$	(1,024	)
Capital gains distributions received	—			9,279			—			—			—
Net realized gain (loss) on shares redeemed	27			921			39,615			10,877			15,187
Net change in unrealized appreciation (depreciation) on investments	(3,237		)	(27,684		)	(103,338		)	(92,356		)	(114,245		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(3,015		)	(15,601		)	(65,108		)	(84,616		)	(100,082		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	—			12,999			219,065			350,582			156,022
Policy loans	—			—			(24,408		)	(22,100		)	(14,484		)
Policy loan repayments and interest	—			—			21,534			4,712			20,957
Surrenders, withdrawals and death benefits	—			—			(34,681		)	(19,896		)	(29,227		)
Net transfers between other subaccounts
or fixed rate option	—			—			(73,821		)	47,603			144,390
Miscellaneous transactions	—			—			(583		)	57			39
Other charges	(1,123		)	(8,221		)	(84,046		)	(163,913		)	(59,221		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(1,123		)	4,778			23,060			197,045			218,476

TOTAL INCREASE (DECREASE) IN NET ASSETS	(4,138		)	(10,823		)	(42,048		)	112,429			118,394

NET ASSETS
Beginning of period	15,590			125,345			1,384,597			1,430,739			797,614
End of period	$	11,452		$	114,522		$	1,342,549		$	1,543,168		$	916,008

Beginning units	748			4,097			55,020			74,528			42,786
Units issued	—			412			8,260			14,472			18,743
Units redeemed	(57		)	(252		)	(7,212		)	(4,098		)	(4,597		)
Ending units	691			4,257			56,068			84,902			56,932

The accompanying notes are an integral part of these financial statements.

A 24

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST Small-Cap Growth Opportunities Portfolio			AST Small-Cap Value Portfolio			AST Goldman Sachs Mid-Cap Growth Portfolio			AST Loomis Sayles Large-Cap Growth Portfolio			AST MFS Growth Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(703	)	$	(1,261	)	$	(2,918	)	$	(6,291	)	$	(2,244	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	20,737			87,160			26,094			99,327			30,815
Net change in unrealized appreciation (depreciation) on investments	(98,400		)	(301,426		)	(156,416		)	(187,645		)	(53,152		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(78,366		)	(215,527		)	(133,240		)	(94,609		)	(24,581		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	130,472			253,432			415,700			309,302			319,790
Policy loans	(14,972		)	(27,485		)	(29,299		)	(49,951		)	(12,119		)
Policy loan repayments and interest	4,874			21,112			5,235			15,174			1,674
Surrenders, withdrawals and death benefits	(20,122		)	(95,601		)	(37,893		)	(94,504		)	(26,851		)
Net transfers between other subaccounts
or fixed rate option	7,455			6,894			566,919			166,249			389,524
Miscellaneous transactions	53			515			312			73			(80		)
Other charges	(56,166		)	(99,366		)	(187,344		)	(143,787		)	(131,514		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	51,594			59,501			733,630			202,556			540,424

TOTAL INCREASE (DECREASE) IN NET ASSETS	(26,772		)	(156,026		)	600,390			107,947			515,843

NET ASSETS
Beginning of period	641,513			1,221,029			1,600,397			2,819,752			1,054,095
End of period	$	614,741		$	1,065,003		$	2,200,787		$	2,927,699		$	1,569,938

Beginning units	22,144			42,818			68,219			114,364			49,577
Units issued	3,702			10,613			56,691			22,060			34,839
Units redeemed	(2,021		)	(8,349		)	(4,952		)	(7,918		)	(4,151		)
Ending units	23,825			45,082			119,958			128,506			80,265

The accompanying notes are an integral part of these financial statements.

A 25

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST BlackRock Low Duration Bond Portfolio			AST T. Rowe Price Natural Resources Portfolio			AST MFS Global Equity Portfolio			AST J.P. Morgan International Equity Portfolio			AST Templeton Global Bond Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(846	)	$	(1,596	)	$	(1,790	)	$	(1,941	)	$	(927	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	1,041			11,467			29,212			12,528			1,491
Net change in unrealized appreciation (depreciation) on investments	4,259			(292,588		)	(159,754		)	(289,542		)	13,409
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	4,454			(282,717		)	(132,332		)	(278,955		)	13,973

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	106,383			301,766			241,328			285,766			111,656
Policy loans	(7,156		)	(44,890		)	(71,884		)	(28,590		)	(17,282		)
Policy loan repayments and interest	1,445			26,373			8,081			15,386			3,772
Surrenders, withdrawals and death benefits	(19,146		)	(44,287		)	(25,232		)	(28,511		)	(10,165		)
Net transfers between other subaccounts
or fixed rate option	121,098			41,098			185,263			283,950			146,168
Miscellaneous transactions	—			(403		)	(170		)	(439		)	38
Other charges	(56,446		)	(103,532		)	(112,957		)	(96,196		)	(57,698		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	146,178			176,125			224,429			431,366			176,489

TOTAL INCREASE (DECREASE) IN NET ASSETS	150,632			(106,592		)	92,097			152,411			190,462

NET ASSETS
Beginning of period	600,022			1,561,906			1,199,436			1,299,245			608,765
End of period	$	750,654		$	1,455,314		$	1,291,533		$	1,451,656		$	799,227

Beginning units	45,747			94,363			53,893			77,755			45,915
Units issued	16,908			18,694			23,267			39,340			20,826
Units redeemed	(4,914		)	(7,461		)	(5,401		)	(5,563		)	(5,732		)
Ending units	57,741			105,596			71,759			111,532			61,009

The accompanying notes are an integral part of these financial statements.

A 26

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	M Capital Appreciation Fund			American Century VP Mid Cap Value Fund (Class I)			AST Hotchkis & Wiley Large-Cap Value Portfolio			AST Small-Cap Growth Portfolio			The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	306		$	9,623		$	(13,928	)	$	(9,352	)	$	3,287
Capital gains distributions received	18,723			42,590			—			—			44,217
Net realized gain (loss) on shares redeemed	600			4,310			206,858			277,670			(3,074		)
Net change in unrealized appreciation (depreciation) on investments	(33,974		)	(155,344		)	(1,097,973		)	(607,384		)	(56,128		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(14,345		)	(98,821		)	(905,043		)	(339,066		)	(11,698		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	9,285			132,318			606,132			340,012			48,830
Policy loans	—			(19,217		)	(149,926		)	(123,719		)	(8,633		)
Policy loan repayments and interest	—			3,201			50,699			37,267			73
Surrenders, withdrawals and death benefits	—			(5,091		)	(243,672		)	(230,086		)	(8,269		)
Net transfers between other subaccounts
or fixed rate option	—			35,864			105,095			94,410			2,869
Miscellaneous transactions	—			3			655			901			212
Other charges	(5,317		)	(54,805		)	(264,469		)	(191,150		)	(23,667		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	3,968			92,273			104,514			(72,365		)	11,415

TOTAL INCREASE (DECREASE) IN NET ASSETS	(10,377		)	(6,548		)	(800,529		)	(411,431		)	(283		)

NET ASSETS
Beginning of period	96,764			682,597			6,284,023			4,228,075			226,481
End of period	$	86,387		$	676,049		$	5,483,494		$	3,816,644		$	226,198

Beginning units	2,275			24,421			334,221			158,608			10,779
Units issued	204			5,387			36,247			14,794			2,357
Units redeemed	(113		)	(2,032		)	(26,330		)	(16,850		)	(1,539		)
Ending units	2,366			27,776			344,138			156,552			11,597

The accompanying notes are an integral part of these financial statements.

A 27

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	Prudential Jennison 20/20 Focus Portfolio (Class I)			MFS® Utilities Series (Initial Class)			Neuberger Berman AMT Sustainable Equity Portfolio (Class S)			AST T. Rowe Price Large-Cap Growth Portfolio			AST BlackRock/Loomis Sayles Bond Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(2,402	)	$	15,927		$	30		$	(15,411	)	$	(21,505	)
Capital gains distributions received	—			6,256			7,801			—			—
Net realized gain (loss) on shares redeemed	90,225			(516		)	25,404			233,459			63,236
Net change in unrealized appreciation (depreciation) on investments	(202,043		)	(7,897		)	(35,359		)	(72,661		)	(124,799		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(114,220		)	13,770			(2,124		)	145,387			(83,068		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	334,716			268,440			27,325			765,033			785,764
Policy loans	(157,747		)	(115,303		)	(528		)	(106,656		)	(239,642		)
Policy loan repayments and interest	10,586			4,788			192			36,323			83,115
Surrenders, withdrawals and death benefits	(34,115		)	(32,823		)	(1,802		)	(130,905		)	(372,593		)
Net transfers between other subaccounts
or fixed rate option	58,572			239,445			(76,826		)	844,055			147,914
Miscellaneous transactions	(512		)	307			149			106			63
Other charges	(155,139		)	(132,983		)	(12,902		)	(391,126		)	(399,196		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	56,361			231,871			(64,392		)	1,016,830			5,425

TOTAL INCREASE (DECREASE) IN NET ASSETS	(57,859		)	245,641			(66,516		)	1,162,217			(77,643		)

NET ASSETS
Beginning of period	2,001,202			1,456,725			216,266			5,957,938			9,391,627
End of period	$	1,943,343		$	1,702,366		$	149,750		$	7,120,155		$	9,313,984

Beginning units	97,170			92,372			11,252			208,942			728,471
Units issued	15,973			33,173			4,360			69,775			58,455
Units redeemed	(11,009		)	(11,911		)	(5,913		)	(15,748		)	(55,511		)
Ending units	102,134			113,634			9,699			262,969			731,415

The accompanying notes are an integral part of these financial statements.

A 28

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST T. Rowe Price Asset Allocation Portfolio			AST Wellington Management Hedged Equity Portfolio			AST Balanced Asset Allocation Portfolio			AST Preservation Asset Allocation Portfolio			AST Fidelity Institutional AM℠ Quantitative Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(13,114	)	$	(20,800	)	$	(67,063	)	$	(14,768	)	$	(2,156	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	75,470			370,458			530,399			226,136			12,592
Net change in unrealized appreciation (depreciation) on investments	(365,270		)	(1,006,465		)	(2,134,443		)	(392,551		)	(84,877		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(302,914		)	(656,807		)	(1,671,107		)	(181,183		)	(74,441		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	1,010,792			1,103,636			3,463,337			577,739			190,835
Policy loans	(115,849		)	(339,419		)	(478,487		)	(99,241		)	(28,074		)
Policy loan repayments and interest	37,639			166,706			200,376			114,138			7,053
Surrenders, withdrawals and death benefits	(152,190		)	(505,094		)	(1,004,081		)	(650,704		)	(21,440		)
Net transfers between other subaccounts
or fixed rate option	220,741			836,885			1,767,057			31,410			102,008
Miscellaneous transactions	(285		)	1,500			972			(2,178		)	31
Other charges	(519,099		)	(461,494		)	(1,758,782		)	(356,915		)	(94,420		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	481,749			802,720			2,190,392			(385,751		)	155,993

TOTAL INCREASE (DECREASE) IN NET ASSETS	178,835			145,913			519,285			(566,934		)	81,552

NET ASSETS
Beginning of period	4,978,307			11,617,742			30,036,070			6,252,774			800,120
End of period	$	5,157,142		$	11,763,655		$	30,555,355		$	5,685,840		$	881,672

Beginning units	206,353			615,812			1,571,640			384,728			36,195
Units issued	36,168			126,905			207,226			32,923			10,812
Units redeemed	(16,162		)	(57,508		)	(93,627		)	(58,245		)	(3,666		)
Ending units	226,359			685,209			1,685,239			359,406			43,341

The accompanying notes are an integral part of these financial statements.

A 29

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST Prudential Growth Allocation Portfolio			AST Advanced Strategies Portfolio			AST RCM World Trends Portfolio			Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares)			AST BlackRock Global Strategies Portfolio
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(17,975	)	$	(4,531	)	$	(2,579	)	$	250		$	(72,089	)
Capital gains distributions received	—			—			—			15,901			—
Net realized gain (loss) on shares redeemed	51,395			34,934			10,615			562			891,080
Net change in unrealized appreciation (depreciation) on investments	(705,160		)	(144,289		)	(95,254		)	(43,801		)	(2,971,567		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(671,740		)	(113,886		)	(87,218		)	(27,088		)	(2,152,576		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	1,618,503			340,081			221,652			26,384			4,383,471
Policy loans	(103,609		)	(24,198		)	(22,284		)	(6,320		)	(880,250		)
Policy loan repayments and interest	40,851			6,406			4,412			162			448,009
Surrenders, withdrawals and death benefits	(192,282		)	(84,757		)	(14,046		)	(815		)	(2,740,300		)
Net transfers between other subaccounts
or fixed rate option	1,109,401			23,909			19,616			39,003			344,777
Miscellaneous transactions	412			33			4			18			1,273
Other charges	(724,584		)	(171,262		)	(96,866		)	(12,496		)	(1,920,856		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	1,748,692			90,212			112,488			45,936			(363,876		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	1,076,952			(23,674		)	25,270			18,848			(2,516,452		)

NET ASSETS
Beginning of period	6,502,781			1,762,479			984,336			132,260			40,070,587
End of period	$	7,579,733		$	1,738,805		$	1,009,606		$	151,108		$	37,554,135

Beginning units	261,193			70,305			47,303			6,456			2,877,968
Units issued	83,927			9,924			8,526			4,580			262,730
Units redeemed	(14,818		)	(6,346		)	(3,016		)	(878		)	(287,974		)
Ending units	330,302			73,883			52,813			10,158			2,852,724

The accompanying notes are an integral part of these financial statements.

A 30

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	TOPS® Aggressive Growth ETF Portfolio (Class 2)			TOPS® Balanced ETF Portfolio (Class 2)			TOPS® Conservative ETF Portfolio (Class 2)			TOPS® Growth ETF Portfolio (Class 2)			TOPS® Moderate Growth ETF Portfolio (Class 2)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	19,078		$	4,244		$	2,039		$	16,039		$	8,314
Capital gains distributions received	80,567			7,081			2,688			58,542			19,940
Net realized gain (loss) on shares redeemed	8,631			368			173			(8,888		)	7,303
Net change in unrealized appreciation (depreciation) on investments	(370,750		)	(34,552		)	(10,397		)	(212,568		)	(92,023		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(262,474		)	(22,859		)	(5,497		)	(146,875		)	(56,466		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	282,702			75,755			34,000			188,899			112,464
Policy loans	(27,243		)	(2,565		)	(586		)	(9,870		)	(2,032		)
Policy loan repayments and interest	6,494			110			1,637			742			306
Surrenders, withdrawals and death benefits	(5,407		)	(4,863		)	(1,247		)	(516		)	(4,382		)
Net transfers between other subaccounts
or fixed rate option	1,270,368			160,625			72,435			735,729			76,954
Miscellaneous transactions	(78		)	82			6			(41		)	(77		)
Other charges	(135,078		)	(43,471		)	(16,300		)	(86,854		)	(71,137		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	1,391,758			185,673			89,945			828,089			112,096

TOTAL INCREASE (DECREASE) IN NET ASSETS	1,129,284			162,814			84,448			681,214			55,630

NET ASSETS
Beginning of period	974,444			210,471			90,687			522,551			698,015
End of period	$	2,103,728		$	373,285		$	175,135		$	1,203,765		$	753,645

Beginning units	52,757			14,421			7,829			35,063			55,491
Units issued	106,135			19,647			8,547			81,378			12,749
Units redeemed	(5,708		)	(3,885		)	(1,070		)	(18,410		)	(4,537		)
Ending units	153,184			30,183			15,306			98,031			63,703

The accompanying notes are an integral part of these financial statements.

A 31

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	TOPS® Managed Risk Balanced ETF Portfolio (Class 2)			TOPS® Managed Risk Growth ETF Portfolio (Class 2)			TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2)			American Funds IS Growth Fund (Class 2)			American Funds IS Growth-Income Fund (Class 2)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	4,494		$	11,268		$	13,671		$	4,753		$	17,907
Capital gains distributions received	16,078			47,209			46,673			128,137			82,847
Net realized gain (loss) on shares redeemed	1,355			4,059			5,874			1,945			7,266
Net change in unrealized appreciation (depreciation) on investments	(41,287		)	(141,616		)	(139,655		)	(223,559		)	(163,935		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(19,360		)	(79,080		)	(73,437		)	(88,724		)	(55,915		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	67,934			157,553			104,952			359,110			366,795
Policy loans	(6,104		)	(11,898		)	(9,216		)	(4,419		)	(7,338		)
Policy loan repayments and interest	13,303			33,393			32,687			1,092			726
Surrenders, withdrawals and death benefits	(15,573		)	(10,802		)	(9,758		)	(6,001		)	(40,988		)
Net transfers between other subaccounts
or fixed rate option	27,666			(4,129		)	30,997			984,217			336,399
Miscellaneous transactions	9			129			201			478			(124		)
Other charges	(31,402		)	(78,980		)	(65,600		)	(182,961		)	(164,464		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	55,833			85,266			84,263			1,151,516			491,006

TOTAL INCREASE (DECREASE) IN NET ASSETS	36,473			6,186			10,826			1,062,792			435,091

NET ASSETS
Beginning of period	261,653			831,123			924,939			711,000			1,039,708
End of period	$	298,126		$	837,309		$	935,765		$	1,773,792		$	1,474,799

Beginning units	19,621			58,716			65,866			46,447			67,456
Units issued	7,049			10,405			11,461			76,123			37,171
Units redeemed	(2,738		)	(4,164		)	(5,302		)	(5,201		)	(6,771		)
Ending units	23,932			64,957			72,025			117,369			97,856

The accompanying notes are an integral part of these financial statements.

A 32

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	Fidelity® VIP Contrafund® Portfolio (Service Class 2)			Fidelity® VIP Mid Cap Portfolio (Service Class 2)			Templeton Growth VIP Fund (Class 2)			Hartford Capital Appreciation HLS Fund (Class IB)			Hartford Disciplined Equity HLS Fund (Class IB)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	2,466		$	2,923		$	1,266		$	143		$	370
Capital gains distributions received	50,784			63,068			5,848			2,336			8,707
Net realized gain (loss) on shares redeemed	855			1,195			(53		)	294			96
Net change in unrealized appreciation (depreciation) on investments	(143,846		)	(295,470		)	(20,319		)	(4,727		)	(11,979		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(89,741		)	(228,284		)	(13,258		)	(1,954		)	(2,806		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	187,156			277,164			32,122			10,119			18,511
Policy loans	(8,844		)	(6,642		)	(190		)	(4,374		)	(249		)
Policy loan repayments and interest	1,072			1,237			—			182			249
Surrenders, withdrawals and death benefits	(17,525		)	(14,167		)	—			—			(779		)
Net transfers between other subaccounts
or fixed rate option	524,263			673,487			29,431			5,445			(390		)
Miscellaneous transactions	(133		)	(401		)	8			2			(4		)
Other charges	(88,454		)	(143,018		)	(15,018		)	(4,029		)	(8,985		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	597,535			787,660			46,353			7,345			8,353

TOTAL INCREASE (DECREASE) IN NET ASSETS	507,794			559,376			33,095			5,391			5,547

NET ASSETS
Beginning of period	537,070			680,899			60,014			17,447			79,555
End of period	$	1,044,864		$	1,240,275		$	93,109		$	22,838		$	85,102

Beginning units	37,886			49,851			4,893			1,162			4,591
Units issued	50,043			63,458			4,751			908			952
Units redeemed	(5,470		)	(5,577		)	(638		)	(429		)	(515		)
Ending units	82,459			107,732			9,006			1,641			5,028

The accompanying notes are an integral part of these financial statements.

A 33

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	Hartford Dividend and Growth HLS Fund (Class IB)			American Funds IS International Fund (Class 2)			Franklin Income VIP Fund (Class 2)			Franklin Mutual Shares VIP Fund (Class 2)			MFS® Total Return Bond Series (Initial Class)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	8,810		$	18,084		$	13,882		$	2,382		$	23,357
Capital gains distributions received	54,963			25,892			—			4,019			—
Net realized gain (loss) on shares redeemed	(385		)	517			594			(463		)	(1,819		)
Net change in unrealized appreciation (depreciation) on investments	(98,861		)	(189,920		)	(32,494		)	(15,849		)	(27,132		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(35,473		)	(145,427		)	(18,018		)	(9,911		)	(5,594		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	80,846			184,579			62,775			15,213			133,201
Policy loans	(443		)	(3,769		)	—			(3,351		)	(8,785		)
Policy loan repayments and interest	420			1,602			—			—			149
Surrenders, withdrawals and death benefits	(1,247		)	(1,484		)	(294		)	—			(3,661		)
Net transfers between other subaccounts
or fixed rate option	101,451			646,042			84,065			22,080			200,344
Miscellaneous transactions	16			99			36			—			14
Other charges	(35,664		)	(60,637		)	(37,607		)	(13,858		)	(75,395		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	145,379			766,432			108,975			20,084			245,867

TOTAL INCREASE (DECREASE) IN NET ASSETS	109,906			621,005			90,957			10,173			240,273

NET ASSETS
Beginning of period	392,192			485,263			277,644			79,957			550,538
End of period	$	502,098		$	1,106,268		$	368,601		$	90,130		$	790,811

Beginning units	23,949			37,664			22,564			6,640			50,325
Units issued	10,653			68,348			11,336			3,112			27,454
Units redeemed	(2,103		)	(3,195		)	(2,107		)	(1,470		)	(4,803		)
Ending units	32,499			102,817			31,793			8,282			72,976

The accompanying notes are an integral part of these financial statements.

A 34

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	MFS® Value Series (Initial Class)			Hartford Growth Opportunities HLS Fund (Class IB)			American Funds IS Blue Chip Income and Growth Fund (Class 2)			Fidelity® VIP Index 500 Portfolio (Service Class 2)			Invesco V.I. Growth and Income Fund (Series I)
	1/1/2018			1/1/2018			1/1/2018			1/1/2018			1/1/2018
	to			to			to			to			to
	12/31/2018			12/31/2018			12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	7,096		$	(377	)	$	7,753		$	19,875		$	8,608
Capital gains distributions received	34,949			54,904			32,968			5,621			44,102
Net realized gain (loss) on shares redeemed	291			6,112			470			5,699			74
Net change in unrealized appreciation (depreciation) on investments	(98,699		)	(68,747		)	(82,751		)	(125,865		)	(119,809		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(56,363		)	(8,108		)	(41,560		)	(94,670		)	(67,025		)

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	102,288			107,690			106,941			320,061			70,631
Policy loans	—			(11,800		)	(293		)	(5,555		)	(237		)
Policy loan repayments and interest	14			924			151			136			99
Surrenders, withdrawals and death benefits	(2,689		)	(5,673		)	(6,461		)	(15,881		)	(3,225		)
Net transfers between other subaccounts
or fixed rate option	185,171			57,253			86,470			461,092			81,937
Miscellaneous transactions	352			(178		)	31			(275		)	22
Other charges	(46,702		)	(29,342		)	(45,594		)	(161,960		)	(38,312		)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	238,434			118,874			141,245			597,618			110,915

TOTAL INCREASE (DECREASE) IN NET ASSETS	182,071			110,766			99,685			502,948			43,890

NET ASSETS
Beginning of period	336,021			308,135			337,247			966,642			374,095
End of period	$	518,092		$	418,901		$	436,932		$	1,469,590		$	417,985

Beginning units	23,923			17,615			22,734			64,421			26,398
Units issued	19,519			8,577			12,815			42,093			8,859
Units redeemed	(1,969		)	(2,291		)	(3,222		)	(3,454		)	(1,119		)
Ending units	41,473			23,901			32,327			103,060			34,138

The accompanying notes are an integral part of these financial statements.

A 35

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2018



	SUBACCOUNTS
	AST International Value Portfolio			Calvert VP NASDAQ 100 Index Portfolio (Class F)			Calvert VP S&P MidCap 400 Index Portfolio (Class F)
	1/1/2018			8/20/2018*			8/20/2018*
	to			to			to
	12/31/2018			12/31/2018			12/31/2018

OPERATIONS
Net investment income (loss)	$	(14,735	)	$	—		$	—
Capital gains distributions received	—			—			—
Net realized gain (loss) on shares redeemed	69,735			—			—
Net change in unrealized appreciation (depreciation) on investments	(839,514		)	1			—
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	(784,514		)	1			—

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	338,243			—			—
Policy loans	(73,742		)	—			—
Policy loan repayments and interest	41,949			—			—
Surrenders, withdrawals and death benefits	(751,461		)	—			—
Net transfers between other subaccounts
or fixed rate option	123,975			19			32
Miscellaneous transactions	3,995			—			—
Other charges	(157,506		)	(2		)	—
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(474,547		)	17			32

TOTAL INCREASE (DECREASE) IN NET ASSETS	(1,259,061		)	18			32

NET ASSETS
Beginning of period	5,093,331			—			—
End of period	$	3,834,270		$	18		$	32

Beginning units	452,680			—			—
Units issued	41,590			2			4
Units redeemed	(87,718		)	—			—
Ending units	406,552			2			4

* Date subaccount became available for investment.

The accompanying notes are an integral part of these financial statements.

A 36

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	Prudential Government Money Market Portfolio			Prudential Diversified Bond Portfolio			Prudential Equity Portfolio (Class I)			Prudential Flexible Managed Portfolio			Prudential Conservative Balanced Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	189,403		$	(390,153	)	$	(1,079,597	)	$	(1,320,048	)	$	(654,252	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	—			7,432,199			6,584,124			7,066,227			3,632,829
Net change in unrealized appreciation (depreciation) on investments	—			2,265,792			42,186,197			36,983,021			12,848,059

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	189,403			9,307,838			47,690,724			42,729,200			15,826,636

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	21,599,333			1,728,689			4,291,894			7,263,842			3,700,789
Policy loans	(99,155		)	(680,037		)	(3,026,182		)	(3,562,360		)	(1,471,143		)
Policy loan repayments and interest	152,620			475,417			3,022,502			4,537,460			1,711,556
Surrenders, withdrawals and death benefits	(16,270,765		)	(60,220,138		)	(10,330,691		)	(15,345,837		)	(7,569,233		)
Net transfers between other subaccounts
or fixed rate option	(62,035,021		)	49,429,224			(910,456		)	(162,917		)	(196,709		)
Miscellaneous transactions	16,511			(78,325		)	(44,516		)	(40,199		)	(23,673		)
Other charges	(1,964,321		)	(2,505,753		)	(3,928,637		)	(6,324,596		)	(3,131,791		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(58,600,798		)	(11,850,923		)	(10,926,086		)	(13,634,607		)	(6,980,204		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	(58,411,395		)	(2,543,085		)	36,764,638			29,094,593			8,846,432

NET ASSETS
Beginning of period	68,220,766			143,238,783			194,300,432			302,141,275			136,997,748
End of period	$	9,809,371		$	140,695,698		$	231,065,070		$	331,235,868		$	145,844,180

Beginning units	50,696,502			47,359,592			16,654,913			27,602,092			16,462,100
Units issued	8,999,770			17,721,568			297,760			140,247			86,470
Units redeemed	(54,333,336		)	(21,741,367		)	(1,053,034		)	(1,321,637		)	(886,467		)
Ending units	5,362,936			43,339,793			15,899,639			26,420,702			15,662,103

The accompanying notes are an integral part of these financial statements.

A 37

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	Prudential High Yield Bond Portfolio			Prudential Stock Index Portfolio			Prudential Value Portfolio (Class I)			Prudential Natural Resources Portfolio (Class I)			Prudential Global Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	103,452,596		$	780,306		$	(158,904	)	$	(50,141	)	$	(74,323	)
Capital gains distributions received	—			1,365,919			—			—			—
Net realized gain (loss) on shares redeemed	37,858,616			1,901,075			646,896			(245,799		)	335,627
Net change in unrealized appreciation (depreciation) on investments	(18,824,361		)	9,741,317			4,525,693			169,531			3,114,364

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	122,486,851			13,788,617			5,013,685			(126,409		)	3,375,668

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	980,341			2,783,146			989,424			455,764			606,822
Policy loans	(274,059		)	(1,011,542		)	(410,456		)	(108,355		)	(268,187		)
Policy loan repayments and interest	192,362			986,407			321,335			229,016			229,883
Surrenders, withdrawals and death benefits	(12,155,169		)	(2,692,996		)	(1,152,703		)	(603,727		)	(637,846		)
Net transfers between other subaccounts
or fixed rate option	(1,783,889,614		)	4,188,374			(177,370		)	(336,355		)	300,649
Miscellaneous transactions	(201,760		)	(1,902		)	(6,249		)	3,062			(1,407		)
Other charges	(15,503,635		)	(1,757,824		)	(735,855		)	(277,438		)	(375,260		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(1,810,851,534		)	2,493,663			(1,171,874		)	(638,033		)	(145,346		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	(1,688,364,683		)	16,282,280			3,841,811			(764,442		)	3,230,322

NET ASSETS
Beginning of period	1,709,443,268			63,580,044			31,212,422			10,138,084			14,024,767
End of period	$	21,078,585		$	79,862,324		$	35,054,233		$	9,373,642		$	17,255,089

Beginning units	503,610,341			15,429,701			2,864,944			814,914			5,014,410
Units issued	215,130			5,055,434			51,399			48,809			236,471
Units redeemed	(499,275,987		)	(4,862,782		)	(196,202		)	(93,293		)	(311,424		)
Ending units	4,549,484			15,622,353			2,720,141			770,430			4,939,457

The accompanying notes are an integral part of these financial statements.

A 38

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	Prudential Government Income Portfolio			Prudential Jennison Portfolio (Class I)			Prudential Small Capitalization Stock Portfolio			T. Rowe Price International Stock Portfolio			Janus Henderson VIT Research Portfolio (Institutional Shares)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(16,670	)	$	(215,249	)	$	(99,131	)	$	118		$	(804	)
Capital gains distributions received	—			—			—			2,037			3,472
Net realized gain (loss) on shares redeemed	13,009			1,575,617			777,889			228			3,282
Net change in unrealized appreciation (depreciation) on investments	69,269			12,501,659			1,404,033			8,811			80,731

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	65,608			13,862,027			2,082,791			11,194			86,681

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	105,767			1,624,332			450,664			1,216			2,202
Policy loans	(64,278		)	(850,365		)	(224,812		)	—			—
Policy loan repayments and interest	37,782			729,428			306,284			—			—
Surrenders, withdrawals and death benefits	(88,139		)	(1,946,559		)	(984,959		)	—			(3,554		)
Net transfers between other subaccounts
or fixed rate option	(110,747		)	230,090			(84,524		)	—			—
Miscellaneous transactions	35			(8,600		)	(5,485		)	—			(27		)
Other charges	(74,373		)	(1,062,106		)	(336,100		)	(1,284		)	(9,543		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(193,953		)	(1,283,780		)	(878,932		)	(68		)	(10,922		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	(128,345		)	12,578,247			1,203,859			11,126			75,759

NET ASSETS
Beginning of period	2,849,680			39,081,143			17,258,046			41,924			323,548
End of period	$	2,721,335		$	51,659,390		$	18,461,905		$	53,050		$	399,307

Beginning units	656,856			10,549,377			1,931,652			35,824			241,582
Units issued	13,035			349,365			53,612			806			1,242
Units redeemed	(56,878		)	(646,800		)	(166,805		)	(865		)	(8,446		)
Ending units	613,013			10,251,942			1,818,459			35,765			234,378

The accompanying notes are an integral part of these financial statements.

A 39

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	MFS® Growth Series (Initial Class)			American Century VP Value Fund (Class I)			Franklin Small-Mid Cap Growth VIP Fund (Class 2)			Prudential SP Small Cap Value Portfolio (Class I)			Janus Henderson VIT Research Portfolio (Service Shares)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(1,742	)	$	3,011		$	(3,378	)	$	(29,803	)	$	(36	)
Capital gains distributions received	8,821			—			36,740			—			16,625
Net realized gain (loss) on shares redeemed	1,391			17,880			(8,574		)	473,182			31,397
Net change in unrealized appreciation (depreciation) on investments	48,040			9,270			44,973			991,993			355,109

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	56,510			30,161			69,761			1,435,372			403,095

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	2,093			1,767			4,655			896,764			104,363
Policy loans	(655		)	—			—			(337,654		)	(97,268		)
Policy loan repayments and interest	635			—			—			126,598			16,491
Surrenders, withdrawals and death benefits	—			(41,514		)	(38,927		)	(665,125		)	(58,552		)
Net transfers between other subaccounts
or fixed rate option	22,705			—			—			145,165			(5,894		)
Miscellaneous transactions	—			(32		)	(157		)	601			309
Other charges	(1,398		)	(9,139		)	(7,101		)	(478,541		)	(45,910		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	23,380			(48,918		)	(41,530		)	(312,192		)	(86,461		)

TOTAL INCREASE (DECREASE) IN NET ASSETS	79,890			(18,757		)	28,231			1,123,180			316,634

NET ASSETS
Beginning of period	166,218			430,958			376,987			12,283,855			1,524,467
End of period	$	246,108		$	412,201		$	405,218		$	13,407,035		$	1,841,101

Beginning units	131,150			121,217			260,631			3,583,343			829,254
Units issued	19,229			425			3,007			166,101			32,693
Units redeemed	(1,269		)	(14,069		)	(30,792		)	(282,065		)	(74,856		)
Ending units	149,110			107,573			232,846			3,467,379			787,091

The accompanying notes are an integral part of these financial statements.

A 40

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	SP Prudential U.S. Emerging Growth Portfolio (Class I)			Prudential SP International Growth Portfolio (Class I)			Janus Henderson VIT Overseas Portfolio (Service Shares)			Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares)			M Large Cap Growth Fund
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(36,427	)	$	(11,091	)	$	8,010		$	355		$	—
Capital gains distributions received	—			—			—			11,237			2,877
Net realized gain (loss) on shares redeemed	471,657			57,400			(20,893		)	396			1,088
Net change in unrealized appreciation (depreciation) on investments	2,568,787			1,172,511			150,787			(1,333		)	25,650

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	3,004,017			1,218,820			137,904			10,655			29,615

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	933,905			408,005			101,575			1,468			8,613
Policy loans	(336,635		)	(119,148		)	(4,801		)	—			—
Policy loan repayments and interest	112,693			32,534			4,524			—			—
Surrenders, withdrawals and death benefits	(707,779		)	(79,427		)	(26,103		)	(2,174		)	—
Net transfers between other subaccounts
or fixed rate option	226,458			(15,857		)	(16,321		)	—			—
Miscellaneous transactions	(1,026		)	(750		)	(47		)	(70		)	—
Other charges	(497,085		)	(179,850		)	(43,618		)	(1,199		)	(6,761		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(269,469		)	45,507			15,209			(1,975		)	1,852

TOTAL INCREASE (DECREASE) IN NET ASSETS	2,734,548			1,264,327			153,113			8,680			31,467

NET ASSETS
Beginning of period	13,626,902			3,428,071			467,010			95,639			75,938
End of period	$	16,361,450		$	4,692,398		$	620,123		$	104,319		$	107,405

Beginning units	4,558,098			2,020,877			68,293			30,892			2,705
Units issued	231,067			172,095			11,946			468			246
Units redeemed	(337,907		)	(157,829		)	(10,841		)	(1,097		)	(198		)
Ending units	4,451,258			2,035,143			69,398			30,263			2,753

The accompanying notes are an integral part of these financial statements.

A 41

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	M International Equity Fund			M Large Cap Value Fund			AST Cohen & Steers Realty Portfolio			AST J.P. Morgan Strategic Opportunities Portfolio			AST T. Rowe Price Large-Cap Value Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	242		$	1,752		$	(1,264	)	$	(2,619	)	$	(727	)
Capital gains distributions received	—			5,846			—			—			—
Net realized gain (loss) on shares redeemed	(1		)	919			42,800			12,621			11,934
Net change in unrealized appreciation (depreciation) on investments	2,921			7,841			35,162			132,268			94,346

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	3,162			16,358			76,698			142,270			105,553

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	—			12,059			275,849			347,194			120,621
Policy loans	—			—			(37,512		)	(26,439		)	(23,186		)
Policy loan repayments and interest	—			—			6,506			5,855			6,864
Surrenders, withdrawals and death benefits	—			—			(43,374		)	(28,307		)	(19,102		)
Net transfers between other subaccounts
or fixed rate option	—			—			60,406			27,792			58,796
Miscellaneous transactions	—			—			6,661			2			19
Other charges	(1,140		)	(7,408		)	(86,231		)	(170,022		)	(43,151		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(1,140		)	4,651			182,305			156,075			100,861

TOTAL INCREASE (DECREASE) IN NET ASSETS	2,022			21,009			259,003			298,345			206,414

NET ASSETS
Beginning of period	13,568			104,336			1,125,594			1,132,394			591,200
End of period	$	15,590		$	125,345		$	1,384,597		$	1,430,739		$	797,614

Beginning units	807			3,921			47,474			66,019			36,080
Units issued	—			441			14,557			13,679			10,167
Units redeemed	(59		)	(265		)	(7,011		)	(5,170		)	(3,461		)
Ending units	748			4,097			55,020			74,528			42,786

The accompanying notes are an integral part of these financial statements.

A 42

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	AST Small-Cap Growth Opportunities Portfolio			AST Small-Cap Value Portfolio			AST Goldman Sachs Mid-Cap Growth Portfolio			AST Loomis Sayles Large-Cap Growth Portfolio			AST MFS Growth Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(556	)	$	(1,068	)	$	(1,484	)	$	(4,936	)	$	(1,149	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	14,314			36,886			13,846			132,121			12,844
Net change in unrealized appreciation (depreciation) on investments	121,474			45,279			267,884			549,984			189,604

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	135,232			81,097			280,246			677,169			201,299

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	109,175			227,239			330,666			252,679			228,131
Policy loans	(16,590		)	(29,152		)	(28,574		)	(61,393		)	(10,760		)
Policy loan repayments and interest	3,447			8,591			5,422			13,304			585
Surrenders, withdrawals and death benefits	(17,817		)	(23,791		)	(21,717		)	(163,541		)	(8,119		)
Net transfers between other subaccounts
or fixed rate option	6,074			45,360			289,442			188,111			162,745
Miscellaneous transactions	(6		)	8,836			48			(45		)	(62		)
Other charges	(54,108		)	(79,234		)	(136,668		)	(124,175		)	(99,100		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	30,175			157,849			438,619			104,940			273,420

TOTAL INCREASE (DECREASE) IN NET ASSETS	165,407			238,946			718,865			782,109			474,719

NET ASSETS
Beginning of period	476,106			982,083			881,532			2,037,643			579,376
End of period	$	641,513		$	1,221,029		$	1,600,397		$	2,819,752		$	1,054,095

Beginning units	20,964			36,932			42,716			106,189			32,577
Units issued	3,179			9,954			29,089			21,307			19,975
Units redeemed	(1,999		)	(4,068		)	(3,586		)	(13,132		)	(2,975		)
Ending units	22,144			42,818			68,219			114,364			49,577

The accompanying notes are an integral part of these financial statements.

A 43

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	AST BlackRock Low Duration Bond Portfolio			AST T. Rowe Price Natural Resources Portfolio			AST MFS Global Equity Portfolio			AST J.P. Morgan International Equity Portfolio			AST Templeton Global Bond Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(650	)	(1,341		)	$	(1,235	)	$	(1,221	)	$	(625	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	1,394			4,091			35,137			12,148			3,309
Net change in unrealized appreciation (depreciation) on investments	7,518			138,034			169,873			244,307			3,643

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	8,262			140,784			203,775			255,234			6,327

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	107,022			259,019			220,762			221,286			96,118
Policy loans	(5,589		)	(60,983		)	(77,965		)	(29,022		)	(19,213		)
Policy loan repayments and interest	1,208			12,515			6,931			5,892			2,550
Surrenders, withdrawals and death benefits	(39,625		)	(76,735		)	(57,556		)	(19,758		)	(6,694		)
Net transfers between other subaccounts
or fixed rate option	64,916			78,735			176,428			154,195			168,344
Miscellaneous transactions	28			206			(264		)	(10		)	(39		)
Other charges	(52,459		)	(96,431		)	(86,093		)	(72,843		)	(40,821		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	75,501			116,326			182,243			259,740			200,245

TOTAL INCREASE (DECREASE) IN NET ASSETS	83,763			257,110			386,018			514,974			206,572

NET ASSETS
Beginning of period	516,259			1,304,796			813,418			784,271			402,193
End of period	$	600,022		$	1,561,906		$	1,199,436		$	1,299,245		$	608,765

Beginning units	39,488			86,867			41,589			59,498			31,320
Units issued	16,456			19,020			19,434			23,471			21,709
Units redeemed	(10,197		)	(11,524		)	(7,130		)	(5,214		)	(7,114		)
Ending units	45,747			94,363			53,893			77,755			45,915

The accompanying notes are an integral part of these financial statements.

A 44

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	M Capital Appreciation Fund			American Century VP Mid Cap Value Fund (Class I)			AST Hotchkis & Wiley Large-Cap Value Portfolio			AST Small-Cap Growth Portfolio			The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	—		$	8,055		$	(12,439	)	$	(8,144	)	$	1,426
Capital gains distributions received	9,985			9,101			—			—			11,563
Net realized gain (loss) on shares redeemed	810			6,203			107,466			159,181			340
Net change in unrealized appreciation (depreciation) on investments	4,303			37,898			892,416			665,889			12,766

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	15,098			61,257			987,443			816,926			26,095

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	8,614			129,545			475,324			301,635			59,053
Policy loans	—			(17,297		)	(116,972		)	(63,057		)	(422		)
Policy loan repayments and interest	—			1,172			53,776			25,555			2,444
Surrenders, withdrawals and death benefits	—			(1,417		)	(130,715		)	(113,135		)	(139		)
Net transfers between other subaccounts
or fixed rate option	—			133,194			161,133			(40,994		)	1,201
Miscellaneous transactions	—			(14		)	319			(674		)	—
Other charges	(4,763		)	(49,218		)	(243,924		)	(164,016		)	(22,674		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	3,851			195,965			198,941			(54,686		)	39,463

TOTAL INCREASE (DECREASE) IN NET ASSETS	18,949			257,222			1,186,384			762,240			65,558

NET ASSETS
Beginning of period	77,815			425,375			5,097,639			3,465,835			160,923
End of period	$	96,764		$	682,597		$	6,284,023		$	4,228,075		$	226,481

Beginning units	2,177			16,981			320,261			160,916			8,740
Units issued	220			9,143			30,388			12,904			2,686
Units redeemed	(122		)	(1,703		)	(16,428		)	(15,212		)	(647		)
Ending units	2,275			24,421			334,221			158,608			10,779

The accompanying notes are an integral part of these financial statements.

A 45

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	Prudential Jennison 20/20 Focus Portfolio (Class I)			MFS® Utilities Series (Initial Class)			Neuberger Berman AMT Sustainable Equity Portfolio (Class S)			AST T. Rowe Price Large-Cap Growth Portfolio			AST BlackRock/Loomis Sayles Bond Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(1,967	)	$	53,017		$	470		$	(10,977	)	$	(21,111	)
Capital gains distributions received	—			—			7,518			—			—
Net realized gain (loss) on shares redeemed	77,696			(1,809		)	722			210,010			42,729
Net change in unrealized appreciation (depreciation) on investments	393,216			101,130			22,903			1,359,736			342,578

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	468,945			152,338			31,613			1,558,769			364,196

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	300,188			250,626			16,475			593,106			776,575
Policy loans	(122,011		)	(40,704		)	(550		)	(127,214		)	(132,646		)
Policy loan repayments and interest	8,646			1,765			179			31,515			80,696
Surrenders, withdrawals and death benefits	(60,179		)	(24,782		)	(66		)	(171,938		)	(265,425		)
Net transfers between other subaccounts
or fixed rate option	(38,096		)	244,108			9,137			342,028			169,394
Miscellaneous transactions	(472		)	(61		)	60			(897		)	65
Other charges	(149,871		)	(115,738		)	(9,855		)	(290,483		)	(396,673		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	(61,795		)	315,214			15,380			376,117			231,986

TOTAL INCREASE (DECREASE) IN NET ASSETS	407,150			467,552			46,993			1,934,886			596,182

NET ASSETS
Beginning of period	1,594,052			989,173			169,273			4,023,052			8,795,445
End of period	$	2,001,202		$	1,456,725		$	216,266		$	5,957,938		$	9,391,627

Beginning units	99,606			68,598			10,205			187,188			709,955
Units issued	11,823			30,888			1,539			39,545			53,503
Units redeemed	(14,259		)	(7,114		)	(492		)	(17,791		)	(34,987		)
Ending units	97,170			92,372			11,252			208,942			728,471

The accompanying notes are an integral part of these financial statements.

A 46

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	AST T. Rowe Price Asset Allocation Portfolio			AST Wellington Management Hedged Equity Portfolio			AST Balanced Asset Allocation Portfolio			AST Preservation Asset Allocation Portfolio			AST Fidelity Institutional AM℠ Quantitative Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(10,920	)	$	(20,103	)	(58,496		)	$	(16,417	)	$	(1,767	)
Capital gains distributions received	—			—			—			—			—
Net realized gain (loss) on shares redeemed	73,264			442,160			544,803			168,572			13,918
Net change in unrealized appreciation (depreciation) on investments	549,382			994,285			3,271,920			416,145			92,725

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	611,726			1,416,342			3,758,227			568,300			104,876

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	1,018,729			1,160,046			3,505,277			656,931			206,335
Policy loans	(198,343		)	(269,622		)	(900,985		)	(221,568		)	(36,323		)
Policy loan repayments and interest	8,240			98,724			219,679			32,276			4,695
Surrenders, withdrawals and death benefits	(44,132		)	(1,014,367		)	(986,455		)	(414,341		)	(25,024		)
Net transfers between other subaccounts
or fixed rate option	236,195			(14,249		)	719,374			36,152			36,324
Miscellaneous transactions	(570		)	243			(295		)	322			654
Other charges	(515,746		)	(461,199		)	(1,620,746		)	(373,124		)	(95,516		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	504,373			(500,424		)	935,849			(283,352		)	91,145

TOTAL INCREASE (DECREASE) IN NET ASSETS	1,116,099			915,918			4,694,076			284,948			196,021

NET ASSETS
Beginning of period	3,862,208			10,701,824			25,341,994			5,967,826			604,099
End of period	$	4,978,307		$	11,617,742		$	30,036,070		$	6,252,774		$	800,120

Beginning units	184,295			643,498			1,520,462			403,201			31,750
Units issued	39,293			45,616			166,023			33,600			8,859
Units redeemed	(17,235		)	(73,302		)	(114,845		)	(52,073		)	(4,414		)
Ending units	206,353			615,812			1,571,640			384,728			36,195

The accompanying notes are an integral part of these financial statements.

A 47

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	AST Prudential Growth Allocation Portfolio			AST Advanced Strategies Portfolio			AST RCM World Trends Portfolio			Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares)			AST BlackRock Global Strategies Portfolio
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	(12,118	)	$	(3,898	)	$	(2,237	)	$	680		$	(67,690	)
Capital gains distributions received	—			—			—			1,475			—
Net realized gain (loss) on shares redeemed	39,944			23,478			18,502			1,017			528,895
Net change in unrealized appreciation (depreciation) on investments	681,374			220,032			115,722			13,158			3,916,903

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	709,200			239,612			131,987			16,330			4,378,108

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	1,397,658			378,861			209,475			17,996			4,548,091
Policy loans	(182,817		)	(43,153		)	(49,524		)	—			(955,458		)
Policy loan repayments and interest	18,040			7,138			2,129			127			436,425
Surrenders, withdrawals and death benefits	(41,591		)	(20,286		)	(36,273		)	(4,052		)	(1,625,182		)
Net transfers between other subaccounts
or fixed rate option	2,644,799			7,335			20,162			23,403			12,906
Miscellaneous transactions	(94		)	410			26			29			16,029
Other charges	(619,305		)	(177,417		)	(99,719		)	(8,932		)	(1,939,448		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	3,216,690			152,888			46,276			28,571			493,363

TOTAL INCREASE (DECREASE) IN NET ASSETS	3,925,890			392,500			178,263			44,901			4,871,471

NET ASSETS
Beginning of period	2,576,891			1,369,979			806,073			87,359			35,199,116
End of period	$	6,502,781		$	1,762,479		$	984,336		$	132,260		$	40,070,587

Beginning units	119,865			63,738			44,912			4,408			2,842,082
Units issued	155,176			12,157			8,204			2,775			249,264
Units redeemed	(13,848		)	(5,590		)	(5,813		)	(727		)	(213,378		)
Ending units	261,193			70,305			47,303			6,456			2,877,968

The accompanying notes are an integral part of these financial statements.

A 48

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	TOPS® Aggressive Growth ETF Portfolio (Class 2)			TOPS® Balanced ETF Portfolio (Class 2)			TOPS® Conservative ETF Portfolio (Class 2)			TOPS® Growth ETF Portfolio (Class 2)			TOPS® Moderate Growth ETF Portfolio (Class 2)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	10,308		$	2,215		$	314		$	5,080		$	6,615
Capital gains distributions received	8,118			1,679			—			3,572			1,967
Net realized gain (loss) on shares redeemed	9,703			1,262			600			3,301			4,954
Net change in unrealized appreciation (depreciation) on investments	112,310			11,595			2,495			52,913			63,145

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	140,439			16,751			3,409			64,866			76,681

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	261,522			80,906			28,051			124,968			195,646
Policy loans	(44,146		)	(1,542		)	(14,981		)	(32,749		)	(4,739		)
Policy loan repayments and interest	7,340			71			764			549			106
Surrenders, withdrawals and death benefits	(2,414		)	(2,858		)	—			(3,502		)	(2,533		)
Net transfers between other subaccounts
or fixed rate option	138,287			23,128			31,854			122,054			50,472
Miscellaneous transactions	438			9			—			28			791
Other charges	(93,980		)	(24,612		)	(9,561		)	(57,302		)	(62,900		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	267,047			75,102			36,127			154,046			176,843

TOTAL INCREASE (DECREASE) IN NET ASSETS	407,486			91,853			39,536			218,912			253,524

NET ASSETS
Beginning of period	566,958			118,618			51,151			303,639			444,491
End of period	$	974,444		$	210,471		$	90,687		$	522,551		$	698,015

Beginning units	35,313			8,750			4,423			24,738			40,697
Units issued	22,859			7,182			5,230			13,767			18,891
Units redeemed	(5,415		)	(1,511		)	(1,824		)	(3,442		)	(4,097		)
Ending units	52,757			14,421			7,829			35,063			55,491

The accompanying notes are an integral part of these financial statements.

A 49

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	TOPS® Managed Risk Balanced ETF Portfolio (Class 2)			TOPS® Managed Risk Growth ETF Portfolio (Class 2)			TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2)			American Funds IS Growth Fund (Class 2)			American Funds IS Growth-Income Fund (Class 2)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	3,058		$	10,024		$	11,758		$	2,077		$	10,288
Capital gains distributions received	371			—			—			38,604			48,405
Net realized gain (loss) on shares redeemed	1,704			3,047			3,412			2,321			1,719
Net change in unrealized appreciation (depreciation) on investments	18,388			97,383			92,619			57,158			89,060

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	23,521			110,454			107,789			100,160			149,472

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	64,904			159,711			102,565			205,211			299,279
Policy loans	(21,485		)	(32,557		)	(34,318		)	(13		)	(303		)
Policy loan repayments and interest	526			52,461			52,250			11			176
Surrenders, withdrawals and death benefits	(7,037		)	(1,082		)	(1,098		)	(9,079		)	(8,526		)
Net transfers between other subaccounts
or fixed rate option	4,918			59,377			2,668			247,964			162,746
Miscellaneous transactions	33			(143		)	(130		)	(185		)	62
Other charges	(35,317		)	(80,760		)	(67,860		)	(84,016		)	(123,964		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	6,542			157,007			54,077			359,893			329,470

TOTAL INCREASE (DECREASE) IN NET ASSETS	30,063			267,461			161,866			460,053			478,942

NET ASSETS
Beginning of period	231,590			563,662			763,073			250,947			560,766
End of period	$	261,653		$	831,123		$	924,939		$	711,000		$	1,039,708

Beginning units	19,190			46,712			61,705			20,216			44,251
Units issued	4,204			16,547			9,422			29,616			27,461
Units redeemed	(3,773		)	(4,543		)	(5,261		)	(3,385		)	(4,256		)
Ending units	19,621			58,716			65,866			46,447			67,456

The accompanying notes are an integral part of these financial statements.

A 50

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	Fidelity® VIP Contrafund® Portfolio (Service Class 2)			Fidelity® VIP Mid Cap Portfolio (Service Class 2)			Templeton Growth VIP Fund (Class 2)			Hartford Capital Appreciation HLS Fund (Class IB)			Hartford Disciplined Equity HLS Fund (Class IB)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	2,353		$	1,931		$	636		$	132		$	433
Capital gains distributions received	14,718			20,588			—			953			7,543
Net realized gain (loss) on shares redeemed	1,774			5,636			349			383			14
Net change in unrealized appreciation (depreciation) on investments	34,381			64,219			6,195			1,766			5,809

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	53,226			92,374			7,180			3,234			13,799

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	141,908			168,447			19,340			8,830			15,918
Policy loans	(1,221		)	(1,451		)	(237		)	(201		)	(4,257		)
Policy loan repayments and interest	1,258			1,504			—			134			419
Surrenders, withdrawals and death benefits	(589		)	(9,358		)	(164		)	(2,476		)	—
Net transfers between other subaccounts
or fixed rate option	208,853			130,899			16,573			(2,797		)	(1,964		)
Miscellaneous transactions	26			55			(1		)	—			2
Other charges	(44,312		)	(73,922		)	(8,703		)	(3,281		)	(9,083		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	305,923			216,174			26,808			209			1,035

TOTAL INCREASE (DECREASE) IN NET ASSETS	359,149			308,548			33,988			3,443			14,834

NET ASSETS
Beginning of period	177,921			372,351			26,026			14,004			64,721
End of period	$	537,070		$	680,899		$	60,014		$	17,447		$	79,555

Beginning units	14,467			32,437			2,496			1,135			4,538
Units issued	25,246			22,923			2,820			952			858
Units redeemed	(1,827		)	(5,509		)	(423		)	(925		)	(805		)
Ending units	37,886			49,851			4,893			1,162			4,591

The accompanying notes are an integral part of these financial statements.

A 51

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	Hartford Dividend and Growth HLS Fund (Class IB)			American Funds IS International Fund (Class 2)			Franklin Income VIP Fund (Class 2)			Franklin Mutual Shares VIP Fund (Class 2)			MFS® Total Return Bond Series (Initial Class)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	4,776		$	4,130		$	8,911		$	1,516		$	15,426
Capital gains distributions received	13,992			1,631			—			2,995			—
Net realized gain (loss) on shares redeemed	471			1,372			880			552			(229		)
Net change in unrealized appreciation (depreciation) on investments	20,987			40,104			8,612			98			2,534

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	40,226			47,237			18,403			5,161			17,731

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	74,168			119,816			70,390			16,932			115,369
Policy loans	(185		)	(199		)	—			—			(9,827		)
Policy loan repayments and interest	363			286			—			—			—
Surrenders, withdrawals and death benefits	(1,031		)	(352		)	(431		)	(91		)	(4,460		)
Net transfers between other subaccounts
or fixed rate option	135,030			281,176			67,673			11,691			130,517
Miscellaneous transactions	25			(19		)	8			92			52
Other charges	(22,682		)	(32,988		)	(26,136		)	(10,226		)	(51,199		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	185,688			367,720			111,504			18,398			180,452

TOTAL INCREASE (DECREASE) IN NET ASSETS	225,914			414,957			129,907			23,559			198,183

NET ASSETS
Beginning of period	166,278			70,306			147,737			56,398			352,355
End of period	$	392,192		$	485,263		$	277,644		$	79,957		$	550,538

Beginning units	11,981			7,254			12,784			5,047			33,467
Units issued	12,835			32,107			11,576			2,598			20,745
Units redeemed	(867		)	(1,697		)	(1,796		)	(1,005		)	(3,887		)
Ending units	23,949			37,664			22,564			6,640			50,325

The accompanying notes are an integral part of these financial statements.

A 52

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	MFS® Value Series (Initial Class)			Hartford Growth Opportunities HLS Fund (Class IB)			American Funds IS Blue Chip Income and Growth Fund (Class 2)			Fidelity® VIP Index 500 Portfolio (Service Class 2)			Invesco V.I. Growth and Income Fund (Series I)
	1/1/2017			1/1/2017			1/1/2017			1/1/2017			1/1/2017
	to			to			to			to			to
	12/31/2017			12/31/2017			12/31/2017			12/31/2017			12/31/2017

OPERATIONS
Net investment income (loss)	$	4,749		$	(228	)	$	5,339		$	11,395		$	3,518
Capital gains distributions received	10,684			3,249			9,900			2,079			11,531
Net realized gain (loss) on shares redeemed	823			1,153			398			22,338			142
Net change in unrealized appreciation (depreciation) on investments	24,333			51,462			28,036			103,643			22,675

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	40,589			55,636			43,673			139,455			37,866

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	63,648			103,980			80,246			269,872			50,857
Policy loans	—			(4,721		)	(149		)	(5,387		)	(110		)
Policy loan repayments and interest	—			456			147			80			101
Surrenders, withdrawals and death benefits	(6,264		)	(256		)	(8,805		)	(40,637		)	—
Net transfers between other subaccounts
or fixed rate option	77,761			24,388			36,330			202,165			89,826
Miscellaneous transactions	134			(33		)	3			(2,330		)	50
Other charges	(29,967		)	(26,938		)	(35,148		)	(113,140		)	(26,377		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	105,312			96,876			72,624			310,623			114,347

TOTAL INCREASE (DECREASE) IN NET ASSETS	145,901			152,512			116,297			450,078			152,213

NET ASSETS
Beginning of period	190,120			155,623			220,950			516,564			221,882
End of period	$	336,021		$	308,135		$	337,247		$	966,642		$	374,095

Beginning units	15,632			11,566			17,389			41,691			17,855
Units issued	9,824			7,609			6,870			39,550			9,416
Units redeemed	(1,533		)	(1,560		)	(1,525		)	(16,820		)	(873		)
Ending units	23,923			17,615			22,734			64,421			26,398

The accompanying notes are an integral part of these financial statements.

A 53

FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT

STATEMENTS OF CHANGES IN NET ASSETS

For the period ended December 31, 2017



	SUBACCOUNTS
	AST International Value Portfolio
	1/1/2017
	to
	12/31/2017

OPERATIONS
Net investment income (loss)	$	(15,463	)
Capital gains distributions received	—
Net realized gain (loss) on shares redeemed	8,551
Net change in unrealized appreciation (depreciation) on investments	931,375

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS	924,463

CONTRACT OWNER TRANSACTIONS
Contract owner net payments	387,398
Policy loans	(88,951		)
Policy loan repayments and interest	21,659
Surrenders, withdrawals and death benefits	(150,315		)
Net transfers between other subaccounts
or fixed rate option	7,455
Miscellaneous transactions	(58		)
Other charges	(148,652		)

NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM CONTRACT OWNER TRANSACTIONS	28,536

TOTAL INCREASE (DECREASE) IN NET ASSETS	952,999

NET ASSETS
Beginning of period	4,140,332
End of period	$	5,093,331

Beginning units	450,477
Units issued	31,898
Units redeemed	(29,695		)
Ending units	452,680

The accompanying notes are an integral part of these financial statements.

A 54

NOTES TO FINANCIAL STATEMENTS OF

PRUCO LIFE OF NEW JERSEY VARIABLE APPRECIABLE ACCOUNT December 31, 2018


Note 1:	General

Pruco Life of New Jersey Variable Appreciable Account (the “Account”) was established under the laws of the State of New Jersey on January 13, 1984 as a separate investment account of Pruco Life Insurance Company of New Jersey (“Pruco Life of New Jersey”), which is a wholly-owned subsidiary of Pruco Life Insurance Company (an Arizona domiciled company), which in turn is wholly-owned by The Prudential Insurance Company of America (“Prudential”). Prudential is a wholly-owned subsidiary of Prudential Financial, Inc. (“Prudential Financial”). Under applicable insurance law, the assets and liabilities of the Account are clearly identified and distinguished from the other assets and liabilities of Pruco Life of New Jersey. Proceeds from purchases of the variable life insurance contracts listed below, are invested in the Account (individually, the “Contract” and collectively, the “Contracts”). The portion of the Account’s assets applicable to the Contracts is not chargeable with liabilities arising out of any other business Pruco Life of New Jersey may conduct.



Pruco Life of New Jersey M Premier VUL Protector	Pruco Life of New Jersey PRUvider Variable Appreciable
(“MPVULP”)	Life (“SVAL2”)
Pruco Life of New Jersey MPremier VUL (“MPVUL”)	Pruco Life of New Jersey Survivorship Variable Universal
Pruco Life of New Jersey PruLife Custom Premier ("PCP")	Life (“SVUL2”)
Pruco Life of New Jersey PruLife Custom Premier II (Base	Pruco Life of New Jersey Variable Appreciable Life (“VAL2”)
2014, 2015) (“PCP2”)	Pruco Life of New Jersey Variable Universal Life
Pruco Life of New Jersey PruLife SVUL Protector ("SVULP")	Protector (Base, 2014, 2018) ("VULP”)
Pruco Life of New Jersey PruSelect III (“PS3”)

The Account is registered with the Securities and Exchange Commission ("SEC") under the Investment Company Act of 1940, as amended, as a unit investment trust. The Account is a funding vehicle for the Contracts. The Contracts offer the option to invest in various subaccounts listed below, each of which invests in a corresponding portfolio of either The Prudential Series Fund, the Advanced Series Trust or one of the non-Prudential administered funds (collectively, the “Portfolios”). Investment options vary by Contract.

The corresponding subaccount names are as follows:



Prudential Government Money Market Portfolio	M International Equity Fund
Prudential Diversified Bond Portfolio	M Large Cap Value Fund
Prudential Equity Portfolio (Class I)	AST Cohen & Steers Realty Portfolio
Prudential Flexible Managed Portfolio	AST J.P. Morgan Strategic Opportunities Portfolio
Prudential Conservative Balanced Portfolio	AST T. Rowe Price Large-Cap Value Portfolio
Prudential High Yield Bond Portfolio	AST Small-Cap Growth Opportunities Portfolio
Prudential Stock Index Portfolio	AST Small-Cap Value Portfolio
Prudential Value Portfolio (Class I)	AST Goldman Sachs Mid-Cap Growth Portfolio
Prudential Natural Resources Portfolio (Class I)	AST Loomis Sayles Large-Cap Growth Portfolio
Prudential Global Portfolio	AST MFS Growth Portfolio
Prudential Government Income Portfolio	AST BlackRock Low Duration Bond Portfolio
Prudential Jennison Portfolio (Class I)	AST T. Rowe Price Natural Resources Portfolio
Prudential Small Capitalization Stock Portfolio	AST MFS Global Equity Portfolio
T. Rowe Price International Stock Portfolio	AST J.P. Morgan International Equity Portfolio
Janus Henderson VIT Research Portfolio (Institutional Shares)	AST Templeton Global Bond Portfolio
MFS® Growth Series (Initial Class)	M Capital Appreciation Fund
American Century VP Value Fund (Class I)	American Century VP Mid Cap Value Fund (Class I)
Franklin Small-Mid Cap Growth VIP Fund (Class 2)	AST Hotchkis & Wiley Large-Cap Value Portfolio
Prudential SP Small Cap Value Portfolio (Class I)	AST Small-Cap Growth Portfolio
Janus Henderson VIT Research Portfolio (Service Shares)	The Dreyfus Sustainable U.S. Equity Portfolio, Inc.
SP Prudential U.S. Emerging Growth Portfolio (Class I)	(Service Shares)
Prudential SP International Growth Portfolio (Class I)	Prudential Jennison 20/20 Focus Portfolio (Class I)
Janus Henderson VIT Overseas Portfolio (Service Shares)	MFS® Utilities Series (Initial Class)
Goldman Sachs VIT Small Cap Equity Insights Fund	Neuberger Berman AMT Sustainable Equity Portfolio (Class S)
(Institutional Shares)	(formerly Neuberger Berman Advisers Management Trust
M Large Cap Growth Fund	Socially Responsive Portfolio (Class S))

A 55


Note 1:	General (continued)



AST T. Rowe Price Large-Cap Growth Portfolio	Dreyfus Investment Portfolios, MidCap Stock Portfolio
AST BlackRock/Loomis Sayles Bond Portfolio	(Initial Shares)*
AST T. Rowe Price Asset Allocation Portfolio	Dreyfus VIF Opportunistic Small Cap Portfolio (Initial Shares)*
AST Wellington Management Hedged Equity Portfolio	Janus Henderson VIT Enterprise Portfolio (Service Shares)*
AST Balanced Asset Allocation Portfolio	Janus Henderson VIT Balanced Portfolio (Service Shares)*
AST Preservation Asset Allocation Portfolio	Oppenheimer Discovery Mid Cap Growth Fund/VA
AST Fidelity Institutional AM℠ Quantitative Portfolio	(Service Shares)*
(formerly AST FI Pyramis Quantitative Portfolio)	ProFund VP Asia 30*
AST Prudential Growth Allocation Portfolio	ProFund VP Banks*
AST Advanced Strategies Portfolio	ProFund VP Bear*
AST RCM World Trends Portfolio	ProFund VP Biotechnology*
Dreyfus Investment Portfolios, MidCap Stock Portfolio	ProFund VP Basic Materials*
(Service Shares)	ProFund VP UltraBull*
AST BlackRock Global Strategies Portfolio	ProFund VP Bull*
TOPS® Aggressive Growth ETF Portfolio (Class 2)	ProFund VP Consumer Services*
TOPS® Balanced ETF Portfolio (Class 2)	ProFund VP Consumer Goods*
TOPS® Conservative ETF Portfolio (Class 2)	ProFund VP Oil & Gas*
TOPS® Growth ETF Portfolio (Class 2)	ProFund VP Europe 30*
TOPS® Moderate Growth ETF Portfolio (Class 2)	ProFund VP Financials*
TOPS® Managed Risk Balanced ETF Portfolio (Class 2)	ProFund VP U.S. Government Plus*
TOPS® Managed Risk Growth ETF Portfolio (Class 2)	ProFund VP Health Care*
TOPS® Managed Risk Moderate Growth ETF Portfolio	ProFund VP Industrials*
(Class 2)	ProFund VP Internet*
American Funds IS Growth Fund (Class 2)	ProFund VP Japan*
American Funds IS Growth-Income Fund (Class 2)	ProFund VP Precious Metals*
Fidelity® VIP Contrafund® Portfolio (Service Class 2)	ProFund VP Mid-Cap Growth*
Fidelity® VIP Mid Cap Portfolio (Service Class 2)	ProFund VP Government Money Market*
Templeton Growth VIP Fund (Class 2)	ProFund VP Mid-Cap Value*
Hartford Capital Appreciation HLS Fund (Class IB)	ProFund VP Pharmaceuticals*
Hartford Disciplined Equity HLS Fund (Class IB)	ProFund VP Real Estate*
Hartford Dividend and Growth HLS Fund (Class IB)	ProFund VP Rising Rates Opportunity*
American Funds IS International Fund (Class 2)	ProFund VP NASDAQ-100 *
Franklin Income VIP Fund (Class 2)	ProFund VP Small-Cap*
Franklin Mutual Shares VIP Fund (Class 2)	ProFund VP Semiconductor*
MFS® Total Return Bond Series (Initial Class)	ProFund VP Small-Cap Growth*
MFS® Value Series (Initial Class)	ProFund VP Short NASDAQ-100 *
Hartford Growth Opportunities HLS Fund (Class IB)	ProFund VP Short Small-Cap*
American Funds IS Blue Chip Income and Growth Fund	ProFund VP Small-Cap Value*
(Class 2)	ProFund VP Technology*
Fidelity® VIP Index 500 Portfolio (Service Class 2)	ProFund VP Telecommunications*
Invesco V.I. Growth and Income Fund (Series I)	ProFund VP UltraMid-Cap*
AST International Value Portfolio	ProFund VP UltraNASDAQ-100 *
Calvert VP NASDAQ 100 Index Portfolio (Class F)	ProFund VP UltraSmall-Cap*
Calvert VP S&P MidCap 400 Index Portfolio (Class F)	ProFund VP Utilities*
American Century VP Income & Growth Fund (Class I)*	Invesco V.I. Technology Fund (Series I)*
Calvert VP EAFE International Index Portfolio (Class F)*	Invesco V.I. Managed Volatility Fund (Series I)*

*Subaccount was available for investment but had no assets as of December 31, 2018, and had no activity

during 2018.

There were no mergers during the period ended December 31, 2018 .

The Portfolios are open-end management investment companies, and each portfolio of The Prudential Series Fund and the Advanced Series Trust is managed by affiliates of Prudential. Each subaccount of the Account indirectly bears exposure to the market, credit, and liquidity risks of the portfolio in which it invests. These

financial statements should be read in conjunction with the financial statements and footnotes of the Portfolios. Additional information on these Portfolios is available upon request to the appropriate companies. New sales of certain products which invest in the Account have been discontinued. However, premium payments made by contract owners will continue to be received by the Account.

A 56

Note 2: Significant Accounting Policies

The Account is an investment company and, accordingly, follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services-Investment Companies, which is part of the accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates. The most significant estimates relate to the valuation of investment in the Portfolios. Subsequent events have been evaluated through the date these financial statements were issued.

Certain prior period contract owner transaction amounts in the Statements of Changes in Net Assets have been reclassified to conform to the current period's presentation.

Investments - The investments in shares of the Portfolios are stated at the reported net asset value per share of the respective Portfolios, which is based on the fair value of the underlying securities in the respective Portfolios. All changes in fair value are recorded as net change in unrealized appreciation (depreciation) on investments in the Statements of Operations of the applicable subaccounts.

Security Transactions - Purchase and sale transactions are recorded as of the trade date of the security being purchased or sold. Realized gains and losses on security transactions are determined based upon an average cost of the investment sold.

Dividend Income and Distributions Received - Dividend and capital gain distributions received are re-invested in additional shares of the Portfolios and are recorded on the ex-distribution date.


Note 3:	Fair Value Measurements

Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative fair value guidance establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows:

Level 1 - Fair value is based on unadjusted quoted prices in active markets for identical assets or liabilities

that the Account can access.

Level 2 - Fair value is based on significant inputs, other than Level 1 inputs, that are observable for the investment, either directly or indirectly, for substantially the full term of the investment through corroboration with observable market data. Level 2 inputs include the reported net asset value per share

of the underlying portfolio, quoted market prices in active markets for similar investments, quoted market prices in markets that are not active for identical or similar investments, and other market observable inputs.

Level 3 - Fair value is based on at least one significant unobservable input for the investment, which may require significant judgment or estimation in determining the fair value.

As of December 31, 2018, management determined that the fair value inputs for all of the Account’s investments, which consist solely of investments in open-end mutual funds registered with the SEC, were considered Level 2.

Transfers between Fair Value Levels

During the period ended December 31, 2018, there were no transfers between fair value levels.

A 57


Note 4:	Taxes

Pruco Life of New Jersey is taxed as a “life insurance company” as defined by the Internal Revenue Code. The results of operations of the Account form a part of Prudential Financial’s consolidated federal tax return. No federal, state or local income taxes are payable by the Account. As such, no provision for tax liability has been recorded in these financial statements. Prudential management will review periodically the status of the policy in the event of changes in the tax law.


Note 5:	Purchases and Sales of Investments

The aggregate costs of purchases and proceeds from sales, excluding distributions received and reinvested, of investments in the Portfolios for the period ended December 31, 2018 were as follows:



	Purchases		Sales
Prudential Government Money Market Portfolio	$	18,373,613	$	18,771,676
Prudential Diversified Bond Portfolio	2,183,464		5,057,349
Prudential Equity Portfolio (Class I)	1,478,051		13,881,612
Prudential Flexible Managed Portfolio	1,887,203		17,883,586
Prudential Conservative Balanced Portfolio	1,288,676		9,129,949
Prudential High Yield Bond Portfolio	6,230,666		6,440,472
Prudential Stock Index Portfolio	4,749,057		6,404,041
Prudential Value Portfolio (Class I)	800,849		2,008,582
Prudential Natural Resources Portfolio (Class I)	241,444		1,095,609
Prudential Global Portfolio	794,565		1,346,954
Prudential Government Income Portfolio	53,485		285,558
Prudential Jennison Portfolio (Class I)	2,257,708		4,360,180
Prudential Small Capitalization Stock Portfolio	730,166		1,709,062
T. Rowe Price International Stock Portfolio	304		14,414
Janus Henderson VIT Research Portfolio (Institutional Shares)	48,942		17,257
MFS® Growth Series (Initial Class)	48,343		114,064
American Century VP Value Fund (Class I)	46,679		27,108
Franklin Small-Mid Cap Growth VIP Fund (Class 2)	2,338		70,252
Prudential SP Small Cap Value Portfolio (Class I)	1,062,442		899,224
Janus Henderson VIT Research Portfolio (Service Shares)	92,965		197,535
SP Prudential U.S. Emerging Growth Portfolio (Class I)	1,031,945		1,852,910
Prudential SP International Growth Portfolio (Class I)	457,547		448,728
Janus Henderson VIT Overseas Portfolio (Service Shares)	107,339		104,261
Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares)	2,035		3,825
M Large Cap Growth Fund	8,775		7,616
M International Equity Fund	—		1,123
M Large Cap Value Fund	12,429		7,652
AST Cohen & Steers Realty Portfolio	200,464		178,788
AST J.P. Morgan Strategic Opportunities Portfolio	273,192		79,285
AST T. Rowe Price Large-Cap Value Portfolio	296,182		78,731
AST Small-Cap Growth Opportunities Portfolio	112,888		61,996
AST Small-Cap Value Portfolio	303,333		245,093
AST Goldman Sachs Mid-Cap Growth Portfolio	852,548		121,835
AST Loomis Sayles Large-Cap Growth Portfolio	408,152		211,887
AST MFS Growth Portfolio	641,846		103,666
AST BlackRock Low Duration Bond Portfolio	210,363		65,030
AST T. Rowe Price Natural Resources Portfolio	297,379		122,851
AST MFS Global Equity Portfolio	356,272		133,633
AST J.P. Morgan International Equity Portfolio	516,760		87,334
AST Templeton Global Bond Portfolio	250,452		74,889
M Capital Appreciation Fund	8,827		4,858
American Century VP Mid Cap Value Fund (Class I)	148,937		57,398
AST Hotchkis & Wiley Large-Cap Value Portfolio	600,917		510,331

A 58


Note 5:	Purchases and Sales of Investments (continued)



	Purchases		Sales
AST Small-Cap Growth Portfolio	$	435,671	$	517,388
The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares)	43,613		32,469
Prudential Jennison 20/20 Focus Portfolio (Class I)	295,419		241,459
MFS® Utilities Series (Initial Class)	426,769		196,989
Neuberger Berman AMT Sustainable Equity Portfolio (Class S)	66,540		131,201
AST T. Rowe Price Large-Cap Growth Portfolio	1,498,073		496,654
AST BlackRock/Loomis Sayles Bond Portfolio	701,500		717,580
AST T. Rowe Price Asset Allocation Portfolio	866,796		398,161
AST Wellington Management Hedged Equity Portfolio	1,900,030		1,118,111
AST Balanced Asset Allocation Portfolio	3,965,906		1,842,577
AST Preservation Asset Allocation Portfolio	530,796		931,315
AST Fidelity Institutional AM℠ Quantitative Portfolio	235,000		81,162
AST Prudential Growth Allocation Portfolio	2,107,308		376,591
AST Advanced Strategies Portfolio	247,635		161,953
AST RCM World Trends Portfolio	173,044		63,135
Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares)	62,961		17,234
AST BlackRock Global Strategies Portfolio	3,619,564		4,055,528
TOPS® Aggressive Growth ETF Portfolio (Class 2)	1,496,750		107,348
TOPS® Balanced ETF Portfolio (Class 2)	233,811		48,520
TOPS® Conservative ETF Portfolio (Class 2)	102,621		12,948
TOPS® Growth ETF Portfolio (Class 2)	1,058,346		231,778
TOPS® Moderate Growth ETF Portfolio (Class 2)	171,252		60,727
TOPS® Managed Risk Balanced ETF Portfolio (Class 2)	91,505		36,353
TOPS® Managed Risk Growth ETF Portfolio (Class 2)	141,844		58,662
TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2)	157,158		75,220
American Funds IS Growth Fund (Class 2)	1,234,205		85,261
American Funds IS Growth-Income Fund (Class 2)	601,655		113,338
Fidelity® VIP Contrafund® Portfolio (Service Class 2)	675,600		79,901
Fidelity® VIP Mid Cap Portfolio (Service Class 2)	863,164		77,565
Templeton Growth VIP Fund (Class 2)	53,748		7,509
Hartford Capital Appreciation HLS Fund (Class IB)	13,977		6,652
Hartford Disciplined Equity HLS Fund (Class IB)	17,622		9,356
Hartford Dividend and Growth HLS Fund (Class IB)	180,612		35,698
American Funds IS International Fund (Class 2)	805,806		40,588
Franklin Income VIP Fund (Class 2)	134,307		25,828
Franklin Mutual Shares VIP Fund (Class 2)	37,076		17,192
MFS® Total Return Bond Series (Initial Class)	297,635		53,052
MFS® Value Series (Initial Class)	265,142		27,639
Hartford Growth Opportunities HLS Fund (Class IB)	163,212		44,715
American Funds IS Blue Chip Income and Growth Fund (Class 2)	189,670		49,487
Fidelity® VIP Index 500 Portfolio (Service Class 2)	648,927		54,414
Invesco V.I. Growth and Income Fund (Series I)	126,153		16,307
AST International Value Portfolio	447,468		936,750
Calvert VP NASDAQ 100 Index Portfolio (Class F)	18		2
Calvert VP S&P MidCap 400 Index Portfolio (Class F)	32		—


Note 6:	Related Party Transactions

The Account has extensive transactions and relationships with Prudential and other affiliates. Due to these relationships, it is possible that the terms of these transactions are not the same as those that would result from transactions among wholly unrelated parties. Prudential Financial and its affiliates perform various services on behalf of the portfolios of The Prudential Series Fund and the Advanced Series Trust in which the Account invests and may receive fees for the services performed. These services include, among other things, investment management, subadvisory, shareholder communications, postage, transfer agency and various other record keeping, administrative and customer service functions.

A 59


Note 6:	Related Party Transactions (continued)

The Prudential Series Fund has entered into a management agreement with PGIM Investments LLC (“PGIM Investments”), and the Advanced Series Trust has entered into a management agreement with PGIM Investments and AST Investment Services, Inc., both indirect, wholly-owned subsidiaries of Prudential Financial (together the “Investment Managers”). Pursuant to these agreements, the Investment Managers have responsibility for all investment advisory services and supervise the subadvisers’ performance of such services with respect to each portfolio of The Prudential Series Fund and the Advanced Series Trust. The Investment Managers entered into subadvisory agreements with several subadvisers, including PGIM, Inc., Jennison Associates LLC, and Quantitative Management Associates LLC, each of which are indirect, wholly-owned subsidiaries of Prudential Financial.

The Prudential Series Fund has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), an indirect, wholly-owned subsidiary of Prudential Financial, which acts as the distributor of the Class I and Class II shares of the portfolios of The Prudential Series Fund. No distribution or service (12b-1) fees are paid to PIMS as distributor of the Class I shares of the portfolios of The Prudential Series Fund, which is the class of shares owned by the Account.

The Advanced Series Trust has a distribution agreement with Prudential Annuities Distributors, Inc. (“PAD”), an indirect wholly-owned subsidiary of Prudential Financial, which acts as the distributor of the shares of each portfolio of the Advanced Series Trust. Distribution and service fees are paid to PAD by most portfolios of the Advanced Series Trust.

Prudential Mutual Fund Services LLC, an affiliate of the Investment Managers and an indirect, wholly-owned subsidiary of Prudential Financial, serves as the transfer agent of each portfolio of The Prudential Series Fund and the Advanced Series Trust.

Certain charges and fees for the portfolios of The Prudential Series Fund and the Advanced Series Trust may be waived and/or reimbursed by Prudential and its affiliates. Prudential and its affiliates reserve the right to discontinue these waivers/ reimbursements at its discretion, subject to the contractual obligations of Prudential and its affiliates.

See The Prudential Series Fund and the Advanced Series Trust financial statements for further discussion of such expense and waiver/reimbursement arrangements. The Account indirectly bears the expenses of the underlying portfolios of The Prudential Series Fund and the Advanced Series Trust in which it invests, including the related party expenses disclosed above.

In 2016, Prudential Financial self-reported to the SEC and the U.S. Department of Labor (“DOL”), and notified other regulators, that in some cases it failed to maximize securities lending income for the benefit of certain portfolios of The Prudential Series Fund and the Advanced Series Trust due to a long-standing restriction benefitting Prudential Financial that limited the availability of loanable securities. Prudential Financial removed the restriction and implemented a remediation plan for the benefit of customers. As part of Prudential Financial’s review of this matter, in 2018 it further self-reported to the SEC, and notified other regulators, that in some cases it failed to timely process foreign tax reclaims for certain portfolios of The Prudential Series Fund and the Advanced Series Trust. Prudential Financial has corrected the foreign tax reclaim process and is implementing a remediation plan for the benefit of customers. The DOL’s review of the securities lending matter is closed. Prudential Financial is cooperating with the SEC in its review of the securities lending and foreign tax reclaim matters (which includes a review of the remediation plans) and has entered into discussions with the SEC staff regarding a possible settlement of the securities lending matter that would potentially involve charges under the Investment Advisers Act and financial remedies.


Note 7:	Financial Highlights

Pruco Life of New Jersey sells a number of variable life insurance products that are funded by the Account. These products have unique combinations of features and fees that are charged against the contract owner’s account balance. Differences in the fee structures result in a variety of unit values, expense ratios and total returns.

In the table below, the units, the net assets, the investment income ratio, and the ranges of lowest to highest unit values, expense ratios, and total returns are presented for the products offered by Pruco Life of New Jersey and funded by the Account. Only product designs within each subaccount that had units outstanding during the respective periods were considered when determining the ranges. The summary may not reflect the minimum and maximum Contract charges offered by Pruco Life of New Jersey as contract owners may not have selected all available and applicable Contract options.

A 60


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*			Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	Prudential Government Money Market Portfolio
December 31, 2018	5,148	$	1.13	to	$	12.06	$	9,561	1.52	%		0.00	%	to	0.90	%	0.58	%	to	1.53	%
December 31, 2017	5,363	$	1.12	to	$	11.88	$	9,809	0.54	%		0.00	%	to	0.90	%	-0.32	%	to	0.56	%
December 31, 2016	50,697	$	1.13	to	$	11.81	$	68,221	0.09	%		0.00	%	to	0.90	%	-0.78	%	to	0.09	%
December 31, 2015	49,197	$	1.14	to	$	11.80	$	66,869	0.00	%	⁽²⁾	0.00	%	to	0.90	%	-0.91	%	to	0.00	%
December 31, 2014	46,793	$	1.15	to	$	11.80	$	64,145	0.00	%	⁽²⁾	0.00	%	to	0.90	%	-0.91	%	to	0.00	%

	Prudential Diversified Bond Portfolio
December 31, 2018	42,423	$	2.22	to	$	22.25	$	137,565	0.00	%		0.00	%	to	0.90	%	-1.05	%	to	0.45	%
December 31, 2017	43,340	$	2.22	to	$	22.28	$	140,696	0.00	%		0.00	%	to	0.90	%	6.05	%	to	7.00	%
December 31, 2016	47,360	$	2.08	to	$	20.82	$	143,239	0.00	%		0.00	%	to	0.90	%	4.65	%	to	5.59	%
December 31, 2015	47,717	$	1.97	to	$	19.72	$	137,271	0.00	%		0.00	%	to	0.90	%	-1.61	%	to	-0.26	%
December 31, 2014	48,613	$	1.98	to	$	19.77	$	140,903	1.09	%		0.00	%	to	0.90	%	0.92	%	to	7.09	%

	Prudential Equity Portfolio (Class I)
December 31, 2018	15,319	$	2.37	to	$	19.79	$	208,708	0.00	%		0.10	%	to	0.90	%	-13.03	%	to	-4.95	%
December 31, 2017	15,900	$	2.52	to	$	20.91	$	231,065	0.00	%		0.10	%	to	0.90	%	24.66	%	to	25.65	%
December 31, 2016	16,655	$	2.02	to	$	16.71	$	194,300	0.00	%		0.10	%	to	0.90	%	2.85	%	to	3.67	%
December 31, 2015	17,254	$	1.96	to	$	16.19	$	198,410	0.00	%		0.10	%	to	0.90	%	-0.99	%	to	2.26	%
December 31, 2014	18,013	$	1.94	to	$	15.90	$	203,771	0.00	%		0.10	%	to	0.90	%	-0.39	%	to	7.60	%

	Prudential Flexible Managed Portfolio
December 31, 2018	25,281	$	2.28	to	$	25.58	$	302,260	0.00	%		0.25	%	to	0.90	%	-8.20	%	to	-4.42	%
December 31, 2017	26,421	$	2.40	to	$	26.76	$	331,236	0.00	%		0.25	%	to	0.90	%	13.95	%	to	14.68	%
December 31, 2016	27,602	$	2.11	to	$	23.34	$	302,141	0.00	%		0.25	%	to	0.90	%	7.55	%	to	8.25	%
December 31, 2015	28,875	$	1.96	to	$	21.56	$	292,626	0.00	%		0.25	%	to	0.90	%	0.11	%	to	0.76	%
December 31, 2014	30,051	$	1.96	to	$	21.40	$	302,602	0.00	%		0.25	%	to	0.90	%	7.11	%	to	10.78	%

	Prudential Conservative Balanced Portfolio
December 31, 2018	14,767	$	2.15	to	$	22.89	$	134,694	0.00	%		0.25	%	to	0.90	%	-5.91	%	to	-2.71	%
December 31, 2017	15,662	$	2.23	to	$	23.53	$	145,844	0.00	%		0.25	%	to	0.90	%	11.37	%	to	12.09	%
December 31, 2016	16,462	$	2.00	to	$	20.99	$	136,998	0.00	%		0.25	%	to	0.90	%	6.32	%	to	7.01	%
December 31, 2015	17,225	$	1.88	to	$	19.62	$	134,210	0.00	%		0.25	%	to	0.90	%	-0.50	%	to	0.15	%
December 31, 2014	18,097	$	1.89	to	$	19.59	$	141,229	0.00	%		0.25	%	to	0.90	%	6.07	%	to	8.50	%

	Prudential High Yield Bond Portfolio
December 31, 2018	4,533	$	2.70	to	$	27.17	$	20,602	2.82	%		0.00	%	to	0.90	%	-3.59	%	to	-1.26	%
December 31, 2017	4,549	$	2.75	to	$	27.52	$	21,079	6.36	%		0.00	%	to	0.90	%	6.84	%	to	7.80	%
December 31, 2016	503,610	$	2.55	to	$	25.53	$	1,709,443	6.48	%		0.00	%	to	0.90	%	15.21	%	to	16.24	%
December 31, 2015	510,436	$	2.20	to	$	21.96	$	1,498,127	6.20	%		0.00	%	to	0.90	%	-5.95	%	to	-2.45	%
December 31, 2014	480,596	$	2.26	to	$	22.51	$	1,469,599	6.04	%		0.00	%	to	0.90	%	-2.22	%	to	2.71	%

	Prudential Stock Index Portfolio
December 31, 2018	14,895	$	2.04	to	$	30.56	$	74,731	0.00	%		0.00	%	to	0.90	%	-11.79	%	to	-4.61	%
December 31, 2017	15,622	$	2.15	to	$	32.04	$	79,862	1.53	%		0.00	%	to	0.90	%	20.38	%	to	21.46	%
December 31, 2016	15,430	$	1.79	to	$	26.38	$	63,580	1.82	%		0.00	%	to	0.90	%	10.84	%	to	11.83	%
December 31, 2015	14,850	$	1.61	to	$	23.59	$	56,464	1.50	%		0.00	%	to	0.90	%	-1.79	%	to	1.18	%
December 31, 2014	14,968	$	1.61	to	$	23.31	$	57,050	3.03	%		0.00	%	to	0.90	%	3.38	%	to	13.31	%

	Prudential Value Portfolio (Class I)
December 31, 2018	2,657	$	2.66	to	$	17.87	$	30,514	0.00	%		0.00	%	to	0.90	%	-12.66	%	to	-9.88	%
December 31, 2017	2,720	$	2.97	to	$	19.83	$	35,054	0.00	%		0.00	%	to	0.90	%	15.95	%	to	16.99	%
December 31, 2016	2,865	$	2.56	to	$	16.95	$	31,212	0.00	%		0.00	%	to	0.90	%	10.40	%	to	11.39	%
December 31, 2015	2,971	$	2.32	to	$	15.22	$	29,380	0.00	%		0.00	%	to	0.90	%	-9.68	%	to	-8.19	%
December 31, 2014	3,103	$	2.55	to	$	16.58	$	33,569	0.00	%		0.00	%	to	0.90	%	-0.18	%	to	10.10	%

A 61


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	Prudential Natural Resources Portfolio (Class I)
December 31, 2018	714	$	5.07	to	$	11.10	$	6,956	0.00	%	0.00	%	to	0.60	%	-18.56	%	to	-18.07	%
December 31, 2017	770	$	6.19	to	$	13.62	$	9,374	0.00	%	0.00	%	to	0.60	%	-0.78	%	to	-0.19	%
December 31, 2016	815	$	6.21	to	$	13.73	$	10,138	0.00	%	0.00	%	to	0.60	%	24.62	%	to	25.36	%
December 31, 2015	819	$	4.96	to	$	11.02	$	8,340	0.00	%	0.00	%	to	0.60	%	-34.15	%	to	-28.19	%
December 31, 2014	907	$	6.91	to	$	15.44	$	13,287	0.00	%	0.00	%	to	0.60	%	-27.35	%	to	-19.90	%

	Prudential Global Portfolio
December 31, 2018	4,785	$	1.48	to	$	11.62	$	15,501	0.00	%	0.10	%	to	0.90	%	-12.16	%	to	-7.40	%
December 31, 2017	4,939	$	1.61	to	$	12.57	$	17,255	0.00	%	0.10	%	to	0.90	%	23.72	%	to	24.71	%
December 31, 2016	5,014	$	1.30	to	$	10.09	$	14,025	0.00	%	0.10	%	to	0.90	%	3.52	%	to	4.34	%
December 31, 2015	5,382	$	1.26	to	$	9.69	$	14,702	0.00	%	0.10	%	to	0.90	%	-3.79	%	to	2.27	%
December 31, 2014	5,596	$	1.24	to	$	3.29	$	15,052	0.00	%	0.10	%	to	0.90	%	-1.22	%	to	3.15	%

	Prudential Government Income Portfolio
December 31, 2018	563	$	4.44	to	$	4.44	$	2,501	0.00	%	0.60	%	to	0.60	%	0.03	%	to	0.03	%
December 31, 2017	613	$	4.44	to	$	4.44	$	2,721	0.00	%	0.60	%	to	0.60	%	2.33	%	to	2.33	%
December 31, 2016	657	$	4.34	to	$	4.34	$	2,850	0.00	%	0.60	%	to	0.60	%	1.56	%	to	1.56	%
December 31, 2015	667	$	4.27	to	$	4.27	$	2,851	0.00	%	0.60	%	to	0.60	%	0.07	%	to	0.07	%
December 31, 2014	745	$	4.27	to	$	4.27	$	3,180	0.35	%	0.60	%	to	0.60	%	5.23	%	to	5.23	%

	Prudential Jennison Portfolio (Class I)
December 31, 2018	9,917	$	1.90	to	$	13.88	$	49,363	0.00	%	0.10	%	to	0.90	%	-12.85	%	to	-0.88	%
December 31, 2017	10,252	$	1.93	to	$	14.02	$	51,659	0.00	%	0.10	%	to	0.90	%	35.48	%	to	36.56	%
December 31, 2016	10,549	$	1.43	to	$	10.28	$	39,081	0.00	%	0.10	%	to	0.90	%	-1.78	%	to	-1.00	%
December 31, 2015	10,862	$	1.45	to	$	10.40	$	41,016	0.00	%	0.10	%	to	0.90	%	3.30	%	to	11.37	%
December 31, 2014	11,041	$	1.32	to	$	5.08	$	37,386	0.00	%	0.10	%	to	0.90	%	1.31	%	to	9.88	%

	Prudential Small Capitalization Stock Portfolio
December 31, 2018	1,729	$	8.77	to	$	24.95	$	16,014	0.00	%	0.00	%	to	0.60	%	-9.27	%	to	-8.72	%
December 31, 2017	1,818	$	9.67	to	$	27.33	$	18,462	0.00	%	0.00	%	to	0.60	%	12.33	%	to	13.00	%
December 31, 2016	1,932	$	8.61	to	$	24.19	$	17,258	0.00	%	0.00	%	to	0.60	%	25.75	%	to	26.50	%
December 31, 2015	2,060	$	6.84	to	$	19.12	$	14,551	0.00	%	0.00	%	to	0.60	%	-4.33	%	to	-2.29	%
December 31, 2014	2,215	$	7.05	to	$	19.57	$	16,016	0.00	%	0.00	%	to	0.60	%	3.65	%	to	5.39	%

	T. Rowe Price International Stock Portfolio
December 31, 2018	27	$	1.26	to	$	1.26	$	33	1.20	%	0.90	%	to	0.90	%	-14.98	%	to	-14.98	%
December 31, 2017	36	$	1.48	to	$	1.48	$	53	1.13	%	0.90	%	to	0.90	%	26.74	%	to	26.74	%
December 31, 2016	36	$	1.17	to	$	1.17	$	42	1.10	%	0.90	%	to	0.90	%	1.22	%	to	1.22	%
December 31, 2015	33	$	1.16	to	$	1.16	$	38	0.95	%	0.90	%	to	0.90	%	-1.78	%	to	-1.78	%
December 31, 2014	31	$	1.18	to	$	1.18	$	37	1.08	%	0.90	%	to	0.90	%	-2.12	%	to	-2.12	%

	Janus Henderson VIT Research Portfolio (Institutional Shares)
December 31, 2018	256	$	1.49	to	$	1.95	$	418	0.54	%	0.20	%	to	0.90	%	-3.45	%	to	-2.77	%
December 31, 2017	234	$	1.54	to	$	2.01	$	399	0.39	%	0.20	%	to	0.90	%	26.74	%	to	27.63	%
December 31, 2016	242	$	1.22	to	$	1.57	$	324	0.54	%	0.20	%	to	0.90	%	-0.40	%	to	0.30	%
December 31, 2015	243	$	1.22	to	$	1.57	$	325	0.63	%	0.20	%	to	0.90	%	4.41	%	to	5.13	%
December 31, 2014	241	$	1.17	to	$	1.49	$	310	0.37	%	0.20	%	to	0.90	%	11.98	%	to	12.77	%

	MFS® Growth Series (Initial Class)
December 31, 2018	114	$	1.68	to	$	1.68	$	191	0.08	%	0.90	%	to	0.90	%	1.75	%	to	1.75	%
December 31, 2017	149	$	1.65	to	$	1.65	$	246	0.11	%	0.90	%	to	0.90	%	30.23	%	to	30.23	%
December 31, 2016	131	$	1.27	to	$	1.27	$	166	0.05	%	0.90	%	to	0.90	%	1.53	%	to	1.53	%
December 31, 2015	131	$	1.25	to	$	1.25	$	164	0.15	%	0.90	%	to	0.90	%	6.61	%	to	6.61	%
December 31, 2014	126	$	1.17	to	$	1.17	$	147	0.11	%	0.90	%	to	0.90	%	7.97	%	to	7.97	%

A 62


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	American Century VP Value Fund (Class I)
December 31, 2018	114	$	3.45	to	$	3.45	$	393	1.65	%	0.90	%	to	0.90	%	-9.97	%	to	-9.97	%
December 31, 2017	108	$	3.83	to	$	3.83	$	412	1.66	%	0.90	%	to	0.90	%	7.78	%	to	7.78	%
December 31, 2016	121	$	3.56	to	$	3.56	$	431	1.75	%	0.90	%	to	0.90	%	19.41	%	to	19.41	%
December 31, 2015	117	$	2.98	to	$	2.98	$	349	2.12	%	0.90	%	to	0.90	%	-4.74	%	to	-4.74	%
December 31, 2014	125	$	3.13	to	$	3.13	$	391	1.54	%	0.90	%	to	0.90	%	12.07	%	to	12.07	%

	Franklin Small-Mid Cap Growth VIP Fund (Class 2)
December 31, 2018	198	$	1.63	to	$	1.63	$	323	0.00	%	0.90	%	to	0.90	%	-6.22	%	to	-6.22	%
December 31, 2017	233	$	1.74	to	$	1.74	$	405	0.00	%	0.90	%	to	0.90	%	20.31	%	to	20.31	%
December 31, 2016	261	$	1.45	to	$	1.45	$	377	0.00	%	0.90	%	to	0.90	%	3.24	%	to	3.24	%
December 31, 2015	252	$	1.40	to	$	1.40	$	353	0.00	%	0.90	%	to	0.90	%	-3.53	%	to	-3.53	%
December 31, 2014	246	$	1.45	to	$	1.45	$	357	0.00	%	0.90	%	to	0.90	%	6.51	%	to	6.51	%

	Prudential SP Small Cap Value Portfolio (Class I)
December 31, 2018	3,443	$	2.84	to	$	29.76	$	11,696	0.00	%	0.00	%	to	0.90	%	-18.54	%	to	-13.79	%
December 31, 2017	3,467	$	3.32	to	$	34.52	$	13,407	0.00	%	0.00	%	to	0.90	%	11.19	%	to	12.19	%
December 31, 2016	3,583	$	2.99	to	$	30.77	$	12,284	0.00	%	0.00	%	to	0.90	%	24.34	%	to	25.45	%
December 31, 2015	3,644	$	2.40	to	$	24.52	$	9,942	0.00	%	0.00	%	to	0.90	%	-7.17	%	to	-5.36	%
December 31, 2014	3,921	$	2.56	to	$	25.91	$	11,341	0.00	%	0.00	%	to	0.90	%	1.10	%	to	4.94	%

	Janus Henderson VIT Research Portfolio (Service Shares)
December 31, 2018	746	$	2.27	to	$	2.27	$	1,692	0.36	%	0.25	%	to	0.25	%	-3.08	%	to	-3.08	%
December 31, 2017	787	$	2.34	to	$	2.34	$	1,841	0.25	%	0.25	%	to	0.25	%	27.24	%	to	27.24	%
December 31, 2016	829	$	1.84	to	$	1.84	$	1,524	0.38	%	0.25	%	to	0.25	%	0.02	%	to	0.02	%
December 31, 2015	826	$	1.84	to	$	1.84	$	1,518	0.45	%	0.25	%	to	0.25	%	4.81	%	to	4.81	%
December 31, 2014	842	$	1.75	to	$	1.75	$	1,477	0.23	%	0.25	%	to	0.25	%	12.45	%	to	12.45	%

	SP Prudential U.S. Emerging Growth Portfolio (Class I)
December 31, 2018	4,219	$	2.96	to	$	39.29	$	14,354	0.00	%	0.00	%	to	0.90	%	-13.48	%	to	-7.84	%
December 31, 2017	4,451	$	3.24	to	$	42.63	$	16,361	0.00	%	0.00	%	to	0.90	%	21.35	%	to	22.43	%
December 31, 2016	4,558	$	2.67	to	$	34.82	$	13,627	0.00	%	0.00	%	to	0.90	%	3.39	%	to	4.32	%
December 31, 2015	4,604	$	2.58	to	$	33.38	$	13,151	0.00	%	0.00	%	to	0.90	%	-7.57	%	to	-2.36	%
December 31, 2014	4,689	$	2.67	to	$	34.19	$	13,664	0.00	%	0.00	%	to	0.90	%	2.92	%	to	10.35	%

	Prudential SP International Growth Portfolio (Class I)
December 31, 2018	2,039	$	1.75	to	$	2.17	$	4,106	0.00	%	0.10	%	to	0.90	%	-13.59	%	to	-12.90	%
December 31, 2017	2,035	$	2.03	to	$	2.49	$	4,692	0.00	%	0.10	%	to	0.90	%	34.60	%	to	35.66	%
December 31, 2016	2,021	$	1.51	to	$	1.84	$	3,428	0.00	%	0.10	%	to	0.90	%	-4.44	%	to	-3.68	%
December 31, 2015	1,922	$	1.58	to	$	1.91	$	3,384	0.00	%	0.10	%	to	0.90	%	-5.89	%	to	3.26	%
December 31, 2014	1,838	$	1.54	to	$	1.85	$	3,130	0.00	%	0.10	%	to	0.90	%	-6.56	%	to	-3.45	%

	Janus Henderson VIT Overseas Portfolio (Service Shares)
December 31, 2018	70	$	7.58	to	$	7.66	$	527	1.66	%	0.00	%	to	0.10	%	-15.22	%	to	-15.14	%
December 31, 2017	69	$	8.94	to	$	9.02	$	620	1.59	%	0.00	%	to	0.10	%	30.67	%	to	30.80	%
December 31, 2016	68	$	6.84	to	$	6.90	$	467	5.03	%	0.00	%	to	0.10	%	-6.80	%	to	-6.71	%
December 31, 2015	61	$	7.34	to	$	7.39	$	445	0.54	%	0.00	%	to	0.10	%	-16.71	%	to	-8.80	%
December 31, 2014	51	$	8.05	to	$	8.11	$	409	5.67	%	0.00	%	to	0.10	%	-16.82	%	to	-12.10	%

	Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares)
December 31, 2018	30	$	3.14	to	$	3.14	$	94	0.47	%	0.20	%	to	0.20	%	-8.80	%	to	-8.80	%
December 31, 2017	30	$	3.45	to	$	3.45	$	104	0.56	%	0.20	%	to	0.20	%	11.34	%	to	11.34	%
December 31, 2016	31	$	3.10	to	$	3.10	$	96	1.23	%	0.20	%	to	0.20	%	22.96	%	to	22.96	%
December 31, 2015	31	$	2.52	to	$	2.52	$	77	0.29	%	0.20	%	to	0.20	%	-2.32	%	to	-2.32	%
December 31, 2014	32	$	2.58	to	$	2.58	$	83	0.81	%	0.20	%	to	0.20	%	6.71	%	to	6.71	%

A 63


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	M Large Cap Growth Fund
December 31, 2018	3	$	37.09	to	$	37.09	$	103	0.00	%	0.00	%	to	0.00	%	-4.95	%	to	-4.95	%
December 31, 2017	3	$	39.02	to	$	39.02	$	107	0.00	%	0.00	%	to	0.00	%	38.97	%	to	38.97	%
December 31, 2016	3	$	28.08	to	$	28.08	$	76	0.00	%	0.00	%	to	0.00	%	-2.32	%	to	-2.32	%
December 31, 2015	3	$	28.74	to	$	28.74	$	74	0.03	%	0.00	%	to	0.00	%	7.70	%	to	7.70	%
December 31, 2014	2	$	26.69	to	$	26.69	$	66	0.04	%	0.00	%	to	0.00	%	10.21	%	to	10.21	%

	M International Equity Fund
December 31, 2018	1	$	16.56	to	$	16.56	$	11	1.36	%	0.00	%	to	0.00	%	-20.57	%	to	-20.57	%
December 31, 2017	1	$	20.85	to	$	20.85	$	16	1.62	%	0.00	%	to	0.00	%	24.05	%	to	24.05	%
December 31, 2016	1	$	16.81	to	$	16.81	$	14	1.15	%	0.00	%	to	0.00	%	-0.05	%	to	-0.05	%
December 31, 2015	1	$	16.82	to	$	16.82	$	15	1.59	%	0.00	%	to	0.00	%	-3.94	%	to	-3.94	%
December 31, 2014	1	$	17.51	to	$	17.51	$	17	2.20	%	0.00	%	to	0.00	%	-7.06	%	to	-7.06	%

	M Large Cap Value Fund
December 31, 2018	4	$	26.90	to	$	26.90	$	115	1.49	%	0.00	%	to	0.00	%	-12.07	%	to	-12.07	%
December 31, 2017	4	$	30.60	to	$	30.60	$	125	1.56	%	0.00	%	to	0.00	%	14.99	%	to	14.99	%
December 31, 2016	4	$	26.61	to	$	26.61	$	104	2.06	%	0.00	%	to	0.00	%	9.64	%	to	9.64	%
December 31, 2015	4	$	24.27	to	$	24.27	$	89	1.40	%	0.00	%	to	0.00	%	-0.66	%	to	-0.66	%
December 31, 2014	3	$	24.43	to	$	24.43	$	83	1.22	%	0.00	%	to	0.00	%	9.68	%	to	9.68	%

	AST Cohen & Steers Realty Portfolio
December 31, 2018	56	$	23.94	to	$	23.94	$	1,343	0.00	%	0.10	%	to	0.10	%	-4.85	%	to	-4.85	%
December 31, 2017	55	$	25.17	to	$	25.17	$	1,385	0.00	%	0.10	%	to	0.10	%	6.14	%	to	6.14	%
December 31, 2016	47	$	23.71	to	$	23.71	$	1,126	0.00	%	0.10	%	to	0.10	%	4.71	%	to	4.71	%
December 31, 2015	39	$	22.64	to	$	22.64	$	880	0.00	%	0.10	%	to	0.10	%	4.46	%	to	4.74	%
December 31, 2014	34	$	21.62	to	$	21.62	$	732	0.00	%	0.10	%	to	0.10	%	7.80	%	to	30.78	%

	AST J.P. Morgan Strategic Opportunities Portfolio
December 31, 2018	85	$	18.12	to	$	18.20	$	1,543	0.00	%	0.10	%	to	0.25	%	-5.75	%	to	-5.22	%
December 31, 2017	75	$	19.12	to	$	19.23	$	1,431	0.00	%	0.10	%	to	0.25	%	11.86	%	to	12.03	%
December 31, 2016	66	$	17.07	to	$	17.19	$	1,132	0.00	%	0.10	%	to	0.25	%	3.58	%	to	3.73	%
December 31, 2015	59	$	16.45	to	$	16.60	$	980	0.00	%	0.10	%	to	0.25	%	-3.00	%	to	-0.28	%
December 31, 2014	47	$	16.50	to	$	16.67	$	787	0.00	%	0.10	%	to	0.25	%	0.95	%	to	5.34	%

	AST T. Rowe Price Large-Cap Value Portfolio
December 31, 2018	57	$	9.97	to	$	17.58	$	916	0.00	%	0.10	%	to	0.25	%	-12.28	%	to	-9.80	%
December 31, 2017	43	$	11.07	to	$	19.50	$	798	0.00	%	0.10	%	to	0.25	%	16.26	%	to	16.43	%
December 31, 2016	36	$	9.53	to	$	16.74	$	591	0.00	%	0.10	%	to	0.25	%	5.86	%	to	6.02	%
December 31, 2015	31	$	9.00	to	$	15.79	$	477	0.00	%	0.10	%	to	0.25	%	-11.00	%	to	-6.16	%
December 31, 2014	27	$	16.83	to	$	16.83	$	462	0.00	%	0.10	%	to	0.10	%	-4.50	%	to	1.46	%

	AST Small-Cap Growth Opportunities Portfolio
December 31, 2018	24	$	25.80	to	$	25.80	$	615	0.00	%	0.10	%	to	0.10	%	-10.93	%	to	-10.93	%
December 31, 2017	22	$	28.97	to	$	28.97	$	642	0.00	%	0.10	%	to	0.10	%	27.56	%	to	27.56	%
December 31, 2016	21	$	22.71	to	$	22.71	$	476	0.00	%	0.10	%	to	0.10	%	7.59	%	to	7.59	%
December 31, 2015	19	$	21.11	to	$	21.11	$	395	0.00	%	0.10	%	to	0.10	%	-4.50	%	to	1.23	%
December 31, 2014	16	$	20.85	to	$	20.85	$	336	0.00	%	0.10	%	to	0.10	%	1.03	%	to	4.84	%

	AST Small-Cap Value Portfolio
December 31, 2018	45	$	23.62	to	$	23.62	$	1,065	0.00	%	0.10	%	to	0.10	%	-17.16	%	to	-17.16	%
December 31, 2017	43	$	28.52	to	$	28.52	$	1,221	0.00	%	0.10	%	to	0.10	%	7.24	%	to	7.24	%
December 31, 2016	37	$	26.59	to	$	26.59	$	982	0.00	%	0.10	%	to	0.10	%	29.07	%	to	29.07	%
December 31, 2015	33	$	20.60	to	$	20.60	$	673	0.00	%	0.10	%	to	0.10	%	-5.21	%	to	-4.41	%
December 31, 2014	29	$	21.55	to	$	21.55	$	625	0.00	%	0.10	%	to	0.10	%	1.90	%	to	5.16	%

A 64


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	AST Goldman Sachs Mid-Cap Growth Portfolio
December 31, 2018	120	$	11.27	to	$	29.48	$	2,201	0.00	%	0.10	%	to	0.25	%	-11.91	%	to	-4.44	%
December 31, 2017	68	$	11.81	to	$	30.85	$	1,600	0.00	%	0.10	%	to	0.25	%	26.77	%	to	26.96	%
December 31, 2016	43	$	9.32	to	$	24.30	$	882	0.00	%	0.10	%	to	0.25	%	1.39	%	to	1.54	%
December 31, 2015	27	$	9.19	to	$	23.93	$	628	0.00	%	0.10	%	to	0.25	%	-8.45	%	to	-5.78	%
December 31, 2014	18	$	25.39	to	$	25.39	$	446	0.00	%	0.10	%	to	0.10	%	2.76	%	to	11.42	%

	AST Loomis Sayles Large-Cap Growth Portfolio
December 31, 2018	129	$	14.24	to	$	28.92	$	2,928	0.00	%	0.10	%	to	0.90	%	-10.11	%	to	-2.78	%
December 31, 2017	114	$	14.67	to	$	29.75	$	2,820	0.00	%	0.10	%	to	0.90	%	31.80	%	to	32.85	%
December 31, 2016	106	$	11.06	to	$	22.39	$	2,038	0.00	%	0.10	%	to	0.90	%	4.64	%	to	5.47	%
December 31, 2015	102	$	10.50	to	$	21.23	$	1,905	0.00	%	0.10	%	to	0.90	%	4.02	%	to	9.96	%
December 31, 2014	105	$	15.07	to	$	19.31	$	1,787	0.00	%	0.10	%	to	0.90	%	3.73	%	to	10.48	%

	AST MFS Growth Portfolio
December 31, 2018	80	$	14.08	to	$	29.74	$	1,570	0.00	%	0.10	%	to	0.25	%	-11.85	%	to	2.05	%
December 31, 2017	50	$	13.81	to	$	29.14	$	1,054	0.00	%	0.10	%	to	0.25	%	30.38	%	to	30.58	%
December 31, 2016	33	$	10.60	to	$	22.32	$	579	0.00	%	0.10	%	to	0.25	%	1.66	%	to	1.81	%
December 31, 2015	18	$	10.42	to	$	21.92	$	383	0.00	%	0.10	%	to	0.25	%	3.26	%	to	7.12	%
December 31, 2014	13	$	20.46	to	$	20.46	$	261	0.00	%	0.10	%	to	0.10	%	3.14	%	to	8.60	%

	AST BlackRock Low Duration Bond Portfolio
December 31, 2018	58	$	10.26	to	$	13.97	$	751	0.00	%	0.10	%	to	0.25	%	0.28	%	to	0.64	%
December 31, 2017	46	$	10.21	to	$	13.88	$	600	0.00	%	0.10	%	to	0.25	%	1.45	%	to	1.60	%
December 31, 2016	39	$	10.06	to	$	13.66	$	516	0.00	%	0.10	%	to	0.25	%	1.38	%	to	1.53	%
December 31, 2015	26	$	9.93	to	$	13.46	$	353	0.00	%	0.10	%	to	0.25	%	-0.74	%	to	0.38	%
December 31, 2014	22	$	13.41	to	$	13.41	$	298	0.00	%	0.10	%	to	0.10	%	-0.89	%	to	-0.20	%

	AST T. Rowe Price Natural Resources Portfolio
December 31, 2018	106	$	13.78	to	$	13.78	$	1,455	0.00	%	0.10	%	to	0.10	%	-16.74	%	to	-16.74	%
December 31, 2017	94	$	16.55	to	$	16.55	$	1,562	0.00	%	0.10	%	to	0.10	%	10.20	%	to	10.20	%
December 31, 2016	87	$	15.02	to	$	15.02	$	1,305	0.00	%	0.10	%	to	0.10	%	24.49	%	to	24.49	%
December 31, 2015	73	$	12.07	to	$	12.07	$	887	0.00	%	0.10	%	to	0.10	%	-23.60	%	to	-19.33	%
December 31, 2014	63	$	14.96	to	$	14.96	$	944	0.00	%	0.10	%	to	0.10	%	-16.57	%	to	-8.45	%

	AST MFS Global Equity Portfolio
December 31, 2018	72	$	11.23	to	$	25.57	$	1,292	0.00	%	0.10	%	to	0.25	%	-10.46	%	to	-9.64	%
December 31, 2017	54	$	12.45	to	$	28.30	$	1,199	0.00	%	0.10	%	to	0.25	%	23.53	%	to	23.72	%
December 31, 2016	42	$	10.08	to	$	22.88	$	813	0.00	%	0.10	%	to	0.25	%	6.84	%	to	7.00	%
December 31, 2015	25	$	9.43	to	$	21.38	$	507	0.00	%	0.10	%	to	0.25	%	-6.34	%	to	-1.56	%
December 31, 2014	20	$	21.72	to	$	21.72	$	445	0.00	%	0.10	%	to	0.10	%	0.29	%	to	3.53	%

	AST J.P. Morgan International Equity Portfolio
December 31, 2018	112	$	9.53	to	$	15.23	$	1,452	0.00	%	0.10	%	to	0.25	%	-17.67	%	to	-11.48	%
December 31, 2017	78	$	11.58	to	$	18.47	$	1,299	0.00	%	0.10	%	to	0.25	%	29.31	%	to	29.50	%
December 31, 2016	59	$	8.95	to	$	14.26	$	784	0.00	%	0.10	%	to	0.25	%	1.68	%	to	1.83	%
December 31, 2015	49	$	8.80	to	$	14.01	$	661	0.00	%	0.10	%	to	0.25	%	-12.51	%	to	-2.89	%
December 31, 2014	38	$	14.42	to	$	14.42	$	544	0.00	%	0.10	%	to	0.10	%	-6.94	%	to	-6.46	%

	AST Templeton Global Bond Portfolio
December 31, 2018	61	$	10.22	to	$	14.53	$	799	0.00	%	0.10	%	to	0.25	%	1.74	%	to	2.56	%
December 31, 2017	46	$	10.04	to	$	14.26	$	609	0.00	%	0.10	%	to	0.25	%	1.79	%	to	1.94	%
December 31, 2016	31	$	9.87	to	$	13.99	$	402	0.00	%	0.10	%	to	0.25	%	4.10	%	to	4.25	%
December 31, 2015	22	$	9.48	to	$	13.42	$	276	0.00	%	0.10	%	to	0.25	%	-5.21	%	to	-4.71	%
December 31, 2014	16	$	14.09	to	$	14.09	$	221	0.00	%	0.10	%	to	0.10	%	-3.16	%	to	0.46	%

A 65


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	M Capital Appreciation Fund
December 31, 2018	2	$	36.51	to	$	36.51	$	86	0.31	%	0.00	%	to	0.00	%	-14.15	%	to	-14.15	%
December 31, 2017	2	$	42.53	to	$	42.53	$	97	0.00	%	0.00	%	to	0.00	%	19.02	%	to	19.02	%
December 31, 2016	2	$	35.74	to	$	35.74	$	78	0.00	%	0.00	%	to	0.00	%	21.06	%	to	21.06	%
December 31, 2015	2	$	29.52	to	$	29.52	$	59	0.00	%	0.00	%	to	0.00	%	-6.58	%	to	-6.58	%
December 31, 2014	2	$	31.60	to	$	31.60	$	59	0.00	%	0.00	%	to	0.00	%	12.42	%	to	12.42	%

	American Century VP Mid Cap Value Fund (Class I)
December 31, 2018	28	$	24.34	to	$	24.34	$	676	1.42	%	0.10	%	to	0.10	%	-12.92	%	to	-12.92	%
December 31, 2017	24	$	27.95	to	$	27.95	$	683	1.64	%	0.10	%	to	0.10	%	11.58	%	to	11.58	%
December 31, 2016	17	$	25.05	to	$	25.05	$	425	1.73	%	0.10	%	to	0.10	%	22.73	%	to	22.73	%
December 31, 2015	13	$	20.41	to	$	20.41	$	256	1.65	%	0.10	%	to	0.10	%	-3.04	%	to	-1.53	%
December 31, 2014	12	$	20.73	to	$	20.73	$	253	1.21	%	0.10	%	to	0.10	%	3.86	%	to	16.31	%

	AST Hotchkis & Wiley Large-Cap Value Portfolio
December 31, 2018	344	$	11.05	to	$	16.63	$	5,483	0.00	%	0.10	%	to	0.90	%	-17.07	%	to	-14.24	%
December 31, 2017	334	$	12.90	to	$	19.39	$	6,284	0.00	%	0.10	%	to	0.90	%	18.13	%	to	19.07	%
December 31, 2016	320	$	10.85	to	$	16.28	$	5,098	0.00	%	0.10	%	to	0.90	%	18.82	%	to	19.77	%
December 31, 2015	307	$	9.07	to	$	13.60	$	4,123	0.00	%	0.10	%	to	0.90	%	-9.98	%	to	-7.93	%
December 31, 2014	309	$	14.00	to	$	14.77	$	4,529	0.00	%	0.10	%	to	0.90	%	3.07	%	to	13.63	%

	AST Small-Cap Growth Portfolio
December 31, 2018	157	$	22.64	to	$	24.65	$	3,817	0.00	%	0.10	%	to	0.90	%	-9.23	%	to	-8.49	%
December 31, 2017	159	$	24.95	to	$	26.94	$	4,228	0.00	%	0.10	%	to	0.90	%	22.81	%	to	23.79	%
December 31, 2016	161	$	20.31	to	$	21.76	$	3,466	0.00	%	0.10	%	to	0.90	%	11.08	%	to	11.96	%
December 31, 2015	162	$	18.29	to	$	19.44	$	3,111	0.00	%	0.10	%	to	0.90	%	-3.35	%	to	0.69	%
December 31, 2014	159	$	18.31	to	$	19.31	$	3,037	0.00	%	0.10	%	to	0.90	%	2.89	%	to	4.09	%

	The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares)
December 31, 2018	12	$	11.35	to	$	20.88	$	226	1.46	%	0.10	%	to	0.25	%	-4.88	%	to	-4.73	%
December 31, 2017	11	$	11.94	to	$	21.91	$	226	0.84	%	0.10	%	to	0.25	%	14.75	%	to	14.92	%
December 31, 2016	9	$	10.40	to	$	19.07	$	161	0.77	%	0.10	%	to	0.25	%	9.80	%	to	9.97	%
December 31, 2015	4	$	9.47	to	$	17.34	$	70	0.62	%	0.10	%	to	0.25	%	-6.51	%	to	-3.51	%
December 31, 2014	1	$	17.97	to	$	17.97	$	19	0.59	%	0.10	%	to	0.10	%	1.82	%	to	13.02	%

	Prudential Jennison 20/20 Focus Portfolio (Class I)
December 31, 2018	102	$	12.67	to	$	20.38	$	1,943	0.00	%	0.10	%	to	0.25	%	-13.00	%	to	-5.45	%
December 31, 2017	97	$	13.42	to	$	21.56	$	2,001	0.00	%	0.10	%	to	0.25	%	29.96	%	to	30.15	%
December 31, 2016	100	$	10.32	to	$	16.56	$	1,594	0.00	%	0.10	%	to	0.25	%	1.36	%	to	1.51	%
December 31, 2015	88	$	10.19	to	$	16.32	$	1,415	0.00	%	0.10	%	to	0.25	%	1.47	%	to	6.16	%
December 31, 2014	76	$	15.37	to	$	15.37	$	1,172	0.00	%	0.10	%	to	0.10	%	-1.93	%	to	7.05	%

	MFS® Utilities Series (Initial Class)
December 31, 2018	114	$	10.63	to	$	17.48	$	1,702	1.14	%	0.10	%	to	0.25	%	-4.56	%	to	0.96	%
December 31, 2017	92	$	10.55	to	$	17.31	$	1,457	4.48	%	0.10	%	to	0.25	%	14.55	%	to	14.72	%
December 31, 2016	69	$	9.21	to	$	15.09	$	989	3.95	%	0.10	%	to	0.25	%	11.19	%	to	11.36	%
December 31, 2015	55	$	8.28	to	$	13.55	$	739	4.24	%	0.10	%	to	0.25	%	-17.36	%	to	-14.60	%
December 31, 2014	49	$	15.87	to	$	15.87	$	770	2.44	%	0.10	%	to	0.10	%	-2.92	%	to	12.62	%

	Neuberger Berman AMT Sustainable Equity Portfolio (Class S)
December 31, 2018	10	$	11.82	to	$	19.79	$	150	0.15	%	0.10	%	to	0.25	%	-12.78	%	to	-6.03	%
December 31, 2017	11	$	12.59	to	$	21.06	$	216	0.36	%	0.10	%	to	0.25	%	17.81	%	to	17.99	%
December 31, 2016	10	$	10.69	to	$	17.85	$	169	0.60	%	0.10	%	to	0.25	%	9.37	%	to	9.53	%
December 31, 2015	4	$	9.77	to	$	16.30	$	66	0.68	%	0.10	%	to	0.25	%	-3.07	%	to	-0.69	%
December 31, 2014	1	$	16.41	to	$	16.41	$	20	0.12	%	0.10	%	to	0.10	%	3.83	%	to	10.00	%

A 66


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	AST T. Rowe Price Large-Cap Growth Portfolio
December 31, 2018	263	$	15.12	to	$	32.14	$	7,120	0.00	%	0.10	%	to	0.90	%	-10.51	%	to	3.76	%
December 31, 2017	209	$	14.60	to	$	30.98	$	5,958	0.00	%	0.10	%	to	0.90	%	36.66	%	to	37.75	%
December 31, 2016	187	$	10.61	to	$	22.49	$	4,023	0.00	%	0.10	%	to	0.90	%	1.78	%	to	2.59	%
December 31, 2015	164	$	10.36	to	$	21.92	$	3,515	0.00	%	0.10	%	to	0.90	%	2.56	%	to	9.47	%
December 31, 2014	152	$	18.99	to	$	20.02	$	3,012	0.00	%	0.10	%	to	0.90	%	2.45	%	to	8.24	%

	AST BlackRock/Loomis Sayles Bond Portfolio
December 31, 2018	731	$	10.36	to	$	13.07	$	9,314	0.00	%	0.00	%	to	0.90	%	-1.55	%	to	-0.16	%
December 31, 2017	728	$	10.45	to	$	13.16	$	9,392	0.00	%	0.00	%	to	0.90	%	3.43	%	to	4.36	%
December 31, 2016	710	$	10.04	to	$	12.61	$	8,795	0.00	%	0.00	%	to	0.90	%	3.30	%	to	4.23	%
December 31, 2015	812	$	9.66	to	$	12.10	$	9,687	0.00	%	0.00	%	to	0.90	%	-3.10	%	to	-2.11	%
December 31, 2014	817	$	11.81	to	$	12.36	$	9,980	0.00	%	0.00	%	to	0.90	%	0.52	%	to	4.23	%

	AST T. Rowe Price Asset Allocation Portfolio
December 31, 2018	226	$	22.78	to	$	22.78	$	5,157	0.00	%	0.25	%	to	0.25	%	-7.62	%	to	-5.56	%
December 31, 2017	206	$	24.13	to	$	24.13	$	4,978	0.00	%	0.25	%	to	0.25	%	15.12	%	to	15.12	%
December 31, 2016	184	$	20.96	to	$	20.96	$	3,862	0.00	%	0.25	%	to	0.25	%	7.27	%	to	7.27	%
December 31, 2015	156	$	19.54	to	$	19.54	$	3,043	0.00	%	0.25	%	to	0.25	%	-0.21	%	to	-0.21	%
December 31, 2014	133	$	19.58	to	$	19.58	$	2,606	0.00	%	0.25	%	to	0.25	%	3.52	%	to	5.62	%

	AST Wellington Management Hedged Equity Portfolio
December 31, 2018	685	$	11.13	to	$	18.08	$	11,764	0.00	%	0.10	%	to	0.90	%	-8.10	%	to	-5.09	%
December 31, 2017	616	$	11.74	to	$	19.05	$	11,618	0.00	%	0.10	%	to	0.90	%	12.58	%	to	13.48	%
December 31, 2016	643	$	10.36	to	$	16.78	$	10,702	0.00	%	0.10	%	to	0.90	%	5.58	%	to	6.42	%
December 31, 2015	644	$	9.75	to	$	15.77	$	10,072	0.00	%	0.10	%	to	0.90	%	-2.87	%	to	-0.73	%
December 31, 2014	643	$	15.25	to	$	15.89	$	10,171	0.00	%	0.10	%	to	0.90	%	1.82	%	to	5.40	%

	AST Balanced Asset Allocation Portfolio
December 31, 2018	1,685	$	17.03	to	$	18.32	$	30,555	0.00	%	0.10	%	to	0.90	%	-7.83	%	to	-5.03	%
December 31, 2017	1,572	$	18.08	to	$	19.29	$	30,036	0.00	%	0.10	%	to	0.90	%	13.88	%	to	14.79	%
December 31, 2016	1,520	$	15.88	to	$	16.80	$	25,342	0.00	%	0.10	%	to	0.90	%	5.35	%	to	6.19	%
December 31, 2015	1,392	$	15.07	to	$	15.82	$	21,870	0.00	%	0.10	%	to	0.90	%	-2.77	%	to	0.38	%
December 31, 2014	1,301	$	15.13	to	$	15.76	$	20,379	0.00	%	0.10	%	to	0.90	%	0.72	%	to	6.42	%

	AST Preservation Asset Allocation Portfolio
December 31, 2018	359	$	14.88	to	$	16.00	$	5,686	0.00	%	0.10	%	to	0.90	%	-4.34	%	to	-2.94	%
December 31, 2017	385	$	15.45	to	$	16.48	$	6,253	0.00	%	0.10	%	to	0.90	%	9.15	%	to	10.02	%
December 31, 2016	403	$	14.16	to	$	14.98	$	5,968	0.00	%	0.10	%	to	0.90	%	4.58	%	to	5.42	%
December 31, 2015	421	$	13.54	to	$	14.21	$	5,923	0.00	%	0.10	%	to	0.90	%	-2.17	%	to	0.04	%
December 31, 2014	399	$	13.64	to	$	14.21	$	5,618	0.00	%	0.10	%	to	0.90	%	0.55	%	to	5.67	%

	AST Fidelity Institutional AM℠ Quantitative Portfolio
December 31, 2018	43	$	20.34	to	$	20.34	$	882	0.00	%	0.25	%	to	0.25	%	-8.63	%	to	-7.98	%
December 31, 2017	36	$	22.11	to	$	22.11	$	800	0.00	%	0.25	%	to	0.25	%	16.18	%	to	16.18	%
December 31, 2016	32	$	19.03	to	$	19.03	$	604	0.00	%	0.25	%	to	0.25	%	3.99	%	to	3.99	%
December 31, 2015	29	$	18.30	to	$	18.30	$	531	0.00	%	0.25	%	to	0.25	%	0.74	%	to	0.74	%
December 31, 2014	21	$	18.16	to	$	18.16	$	376	0.00	%	0.25	%	to	0.25	%	2.89	%	to	2.89	%

	AST Prudential Growth Allocation Portfolio
December 31, 2018	330	$	22.95	to	$	22.95	$	7,580	0.00	%	0.25	%	to	0.25	%	-10.12	%	to	-7.83	%
December 31, 2017	261	$	24.90	to	$	24.90	$	6,503	0.00	%	0.25	%	to	0.25	%	15.81	%	to	15.81	%
December 31, 2016	120	$	21.50	to	$	21.50	$	2,577	0.00	%	0.25	%	to	0.25	%	9.82	%	to	9.82	%
December 31, 2015	95	$	19.58	to	$	19.58	$	1,856	0.00	%	0.25	%	to	0.25	%	-0.86	%	to	-0.86	%
December 31, 2014	60	$	19.75	to	$	19.75	$	1,182	0.00	%	0.25	%	to	0.25	%	5.66	%	to	8.93	%

A 67


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	AST Advanced Strategies Portfolio
December 31, 2018	74	$	23.53	to	$	23.53	$	1,739	0.00	%	0.25	%	to	0.25	%	-8.21	%	to	-6.12	%
December 31, 2017	70	$	25.07	to	$	25.07	$	1,762	0.00	%	0.25	%	to	0.25	%	16.63	%	to	16.63	%
December 31, 2016	64	$	21.49	to	$	21.49	$	1,370	0.00	%	0.25	%	to	0.25	%	6.84	%	to	6.84	%
December 31, 2015	60	$	20.12	to	$	20.12	$	1,198	0.00	%	0.25	%	to	0.25	%	0.55	%	to	0.55	%
December 31, 2014	48	$	20.01	to	$	20.01	$	956	0.00	%	0.25	%	to	0.25	%	3.22	%	to	5.84	%

	AST RCM World Trends Portfolio
December 31, 2018	53	$	19.12	to	$	19.12	$	1,010	0.00	%	0.25	%	to	0.25	%	-8.24	%	to	-8.13	%
December 31, 2017	47	$	20.81	to	$	20.81	$	984	0.00	%	0.25	%	to	0.25	%	15.94	%	to	15.94	%
December 31, 2016	45	$	17.95	to	$	17.95	$	806	0.00	%	0.25	%	to	0.25	%	4.55	%	to	4.55	%
December 31, 2015	40	$	17.17	to	$	17.17	$	687	0.00	%	0.25	%	to	0.25	%	-0.41	%	to	-0.41	%
December 31, 2014	34	$	17.24	to	$	17.24	$	586	0.00	%	0.25	%	to	0.25	%	2.20	%	to	4.88	%

	Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares)
December 31, 2018	10	$	10.51	to	$	20.30	$	151	0.31	%	0.10	%	to	0.25	%	-17.35	%	to	-15.77	%
December 31, 2017	6	$	12.50	to	$	24.10	$	132	0.76	%	0.10	%	to	0.25	%	14.75	%	to	14.93	%
December 31, 2016	4	$	10.89	to	$	20.97	$	87	0.80	%	0.10	%	to	0.25	%	14.91	%	to	15.09	%
December 31, 2015	3	$	9.48	to	$	18.22	$	62	0.39	%	0.10	%	to	0.25	%	-6.23	%	to	-2.61	%
December 31, 2014	2	$	18.71	to	$	18.71	$	38	0.73	%	0.10	%	to	0.10	%	0.32	%	to	11.65	%

	AST BlackRock Global Strategies Portfolio
December 31, 2018	2,853	$	12.46	to	$	13.25	$	37,554	0.00	%	0.10	%	to	0.90	%	-6.76	%	to	-5.37	%
December 31, 2017	2,878	$	13.27	to	$	14.00	$	40,071	0.00	%	0.10	%	to	0.90	%	11.61	%	to	12.50	%
December 31, 2016	2,842	$	11.89	to	$	12.44	$	35,199	0.00	%	0.10	%	to	0.90	%	6.01	%	to	6.85	%
December 31, 2015	2,807	$	11.22	to	$	11.64	$	32,552	0.00	%	0.10	%	to	0.90	%	-5.81	%	to	-3.10	%
December 31, 2014	2,739	$	11.67	to	$	12.02	$	32,808	0.00	%	0.10	%	to	0.90	%	-0.69	%	to	4.79	%

	TOPS® Aggressive Growth ETF Portfolio (Class 2)
December 31, 2018	153	$	11.23	to	$	18.73	$	2,104	1.44	%	0.10	%	to	0.25	%	-12.73	%	to	-9.97	%
December 31, 2017	53	$	12.50	to	$	20.80	$	974	1.48	%	0.10	%	to	0.25	%	20.09	%	to	20.27	%
December 31, 2016	35	$	10.40	to	$	17.29	$	567	1.17	%	0.10	%	to	0.25	%	12.88	%	to	13.05	%
December 31, 2015	23	$	9.22	to	$	15.30	$	342	1.38	%	0.10	%	to	0.25	%	-8.60	%	to	-3.76	%
December 31, 2014	6	$	15.90	to	$	15.90	$	92	1.11	%	0.10	%	to	0.10	%	-1.71	%	to	4.71	%

	TOPS® Balanced ETF Portfolio (Class 2)
December 31, 2018	30	$	10.62	to	$	14.26	$	373	1.70	%	0.10	%	to	0.25	%	-5.86	%	to	-5.72	%
December 31, 2017	14	$	11.28	to	$	15.12	$	210	1.45	%	0.10	%	to	0.25	%	10.67	%	to	10.84	%
December 31, 2016	9	$	10.19	to	$	13.64	$	119	1.25	%	0.10	%	to	0.25	%	7.65	%	to	7.81	%
December 31, 2015	2	$	9.47	to	$	12.66	$	26	1.55	%	0.10	%	to	0.25	%	-5.58	%	to	-2.66	%
December 31, 2014	2	$	13.00	to	$	13.00	$	31	1.78	%	0.10	%	to	0.10	%	-1.46	%	to	3.44	%

	TOPS® Conservative ETF Portfolio (Class 2)
December 31, 2018	15	$	10.49	to	$	12.84	$	175	1.66	%	0.10	%	to	0.25	%	-3.74	%	to	-2.78	%
December 31, 2017	8	$	10.81	to	$	13.20	$	91	0.78	%	0.10	%	to	0.25	%	6.56	%	to	6.72	%
December 31, 2016	4	$	10.14	to	$	12.37	$	51	0.84	%	0.10	%	to	0.25	%	5.56	%	to	5.72	%
December 31, 2015	2	$	9.61	to	$	11.70	$	24	1.39	%	0.10	%	to	0.25	%	-4.07	%	to	-2.19	%
December 31, 2014	3	$	11.97	to	$	11.97	$	34	0.45	%	0.10	%	to	0.10	%	2.02	%	to	2.02	%

	TOPS® Growth ETF Portfolio (Class 2)
December 31, 2018	98	$	11.01	to	$	18.66	$	1,204	2.26	%	0.10	%	to	0.25	%	-10.86	%	to	-8.87	%
December 31, 2017	35	$	12.10	to	$	20.48	$	523	1.45	%	0.10	%	to	0.25	%	17.65	%	to	17.82	%
December 31, 2016	25	$	10.29	to	$	17.38	$	304	1.29	%	0.10	%	to	0.25	%	12.05	%	to	12.21	%
December 31, 2015	20	$	9.18	to	$	15.49	$	221	1.21	%	0.10	%	to	0.25	%	-8.78	%	to	-4.44	%
December 31, 2014	4	$	16.21	to	$	16.21	$	57	1.52	%	0.10	%	to	0.10	%	-2.29	%	to	3.55	%

A 68


Note 7:	Financial Highlights (continued)



	At the year ended								For the year ended
	Units (000s)	Unit Value Lowest — Highest					Net Assets (000s)		Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	TOPS® Moderate Growth ETF Portfolio (Class 2)
December 31, 2018	64	$	10.88	to	$	15.64	$	754	1.34	%	0.10	%	to	0.25	%	-8.50	%	to	-6.98	%
December 31, 2017	55	$	11.72	to	$	16.81	$	698	1.32	%	0.10	%	to	0.25	%	13.83	%	to	14.00	%
December 31, 2016	41	$	10.29	to	$	14.75	$	444	0.69	%	0.10	%	to	0.25	%	10.24	%	to	10.41	%
December 31, 2015	10	$	9.34	to	$	13.36	$	111	1.12	%	0.10	%	to	0.25	%	-7.13	%	to	-3.53	%
December 31, 2014	2	$	13.85	to	$	13.85	$	30	2.46	%	0.10	%	to	0.10	%	-1.84	%	to	3.38	%

	TOPS® Managed Risk Balanced ETF Portfolio (Class 2)
December 31, 2018	24	$	12.02	to	$	12.52	$	298	1.83	%	0.10	%	to	0.25	%	-6.27	%	to	-6.12	%
December 31, 2017	20	$	12.80	to	$	13.35	$	262	1.52	%	0.10	%	to	0.25	%	10.31	%	to	10.47	%
December 31, 2016	19	$	11.59	to	$	12.11	$	232	1.33	%	0.10	%	to	0.25	%	5.96	%	to	6.12	%
December 31, 2015	17	$	10.92	to	$	11.42	$	194	1.21	%	0.10	%	to	0.25	%	-4.74	%	to	-4.59	%
December 31, 2014	12	$	11.45	to	$	11.99	$	141	0.99	%	0.10	%	to	0.25	%	-1.44	%	to	2.96	%

	TOPS® Managed Risk Growth ETF Portfolio (Class 2)
December 31, 2018	65	$	12.36	to	$	12.91	$	837	1.57	%	0.10	%	to	0.25	%	-8.95	%	to	-8.52	%
December 31, 2017	59	$	13.55	to	$	14.18	$	831	1.71	%	0.10	%	to	0.25	%	17.37	%	to	17.54	%
December 31, 2016	47	$	11.53	to	$	12.09	$	564	1.72	%	0.10	%	to	0.25	%	5.31	%	to	5.46	%
December 31, 2015	36	$	10.93	to	$	11.48	$	416	1.45	%	0.10	%	to	0.25	%	-11.76	%	to	-9.24	%
December 31, 2014	35	$	12.04	to	$	12.66	$	441	0.85	%	0.10	%	to	0.25	%	-3.18	%	to	1.21	%

	TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2)
December 31, 2018	72	$	12.46	to	$	13.02	$	936	1.69	%	0.10	%	to	0.25	%	-7.45	%	to	-7.31	%
December 31, 2017	66	$	13.44	to	$	14.06	$	925	1.63	%	0.10	%	to	0.25	%	13.56	%	to	13.73	%
December 31, 2016	62	$	11.82	to	$	12.38	$	763	1.89	%	0.10	%	to	0.25	%	6.05	%	to	6.21	%
December 31, 2015	30	$	11.13	to	$	11.68	$	349	1.36	%	0.10	%	to	0.25	%	-9.59	%	to	-6.45	%
December 31, 2014	29	$	11.89	to	$	12.50	$	360	0.93	%	0.10	%	to	0.25	%	-2.00	%	to	2.71	%

	American Funds IS Growth Fund (Class 2)
December 31, 2018	117	$	14.02	to	$	17.35	$	1,774	0.55	%	0.10	%	to	0.25	%	-11.23	%	to	-0.35	%
December 31, 2017	46	$	14.09	to	$	17.41	$	711	0.65	%	0.10	%	to	0.25	%	27.97	%	to	28.16	%
December 31, 2016	20	$	11.01	to	$	13.59	$	251	0.95	%	0.10	%	to	0.25	%	9.22	%	to	9.38	%
December 31, 2015	10	$	10.08	to	$	12.42	$	116	0.80	%	0.10	%	to	0.25	%	0.03	%	to	6.75	%
December 31, 2014	5	$	11.64	to	$	11.64	$	53	1.86	%	0.10	%	to	0.10	%	1.12	%	to	8.40	%

	American Funds IS Growth-Income Fund (Class 2)
December 31, 2018	98	$	14.65	to	$	16.42	$	1,475	1.61	%	0.10	%	to	0.25	%	-10.03	%	to	-1.89	%
December 31, 2017	67	$	14.95	to	$	16.73	$	1,040	1.55	%	0.10	%	to	0.25	%	22.08	%	to	22.26	%
December 31, 2016	44	$	12.25	to	$	13.69	$	561	1.75	%	0.10	%	to	0.25	%	11.24	%	to	11.41	%
December 31, 2015	23	$	11.01	to	$	12.28	$	266	1.62	%	0.10	%	to	0.25	%	-3.00	%	to	1.35	%
December 31, 2014	9	$	10.88	to	$	12.12	$	104	2.85	%	0.10	%	to	0.25	%	0.74	%	to	10.52	%

	Fidelity® VIP Contrafund® Portfolio (Service Class 2)
December 31, 2018	82	$	11.84	to	$	14.88	$	1,045	0.46	%	0.10	%	to	0.25	%	-13.08	%	to	-6.73	%
December 31, 2017	38	$	12.71	to	$	15.95	$	537	0.97	%	0.10	%	to	0.25	%	21.28	%	to	21.47	%
December 31, 2016	14	$	10.48	to	$	13.13	$	178	0.97	%	0.10	%	to	0.25	%	7.46	%	to	7.62	%
December 31, 2015	5	$	9.75	to	$	12.20	$	61	1.27	%	0.10	%	to	0.25	%	-3.48	%	to	0.32	%
December 31, 2014	1	$	12.17	to	$	12.17	$	18	0.29	%	0.10	%	to	0.10	%	2.54	%	to	11.54	%

	Fidelity® VIP Mid Cap Portfolio (Service Class 2)
December 31, 2018	108	$	10.83	to	$	12.99	$	1,240	0.47	%	0.10	%	to	0.25	%	-19.33	%	to	-14.86	%
December 31, 2017	50	$	12.73	to	$	15.26	$	681	0.58	%	0.10	%	to	0.25	%	20.24	%	to	20.42	%
December 31, 2016	32	$	10.59	to	$	12.67	$	372	0.48	%	0.10	%	to	0.25	%	11.64	%	to	11.81	%
December 31, 2015	8	$	9.49	to	$	11.33	$	91	0.44	%	0.10	%	to	0.25	%	-6.25	%	to	-1.73	%
December 31, 2014	1	$	11.53	to	$	11.53	$	13	0.06	%	0.10	%	to	0.10	%	-0.32	%	to	5.93	%

A 69


Note 7:	Financial Highlights (continued)



	At the year ended										For the year ended
	Units (000s)		Unit Value Lowest — Highest					Net Assets (000s)			Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	Templeton Growth VIP Fund (Class 2)
December 31, 2018	9		$	9.70	to	$	10.72	$	93		1.84	%	0.10	%	to	0.25	%	-15.06	%	to	-14.93	%
December 31, 2017	5		$	11.43	to	$	12.60	$	60		1.59	%	0.10	%	to	0.25	%	18.20	%	to	18.38	%
December 31, 2016	2		$	9.67	to	$	10.64	$	26		1.89	%	0.10	%	to	0.25	%	9.35	%	to	9.51	%
December 31, 2015	2		$	8.84	to	$	9.72	$	17		3.25	%	0.10	%	to	0.25	%	-11.89	%	to	-6.58	%
December 31, 2014	7		$	10.40	to	$	10.40	$	74		0.72	%	0.10	%	to	0.10	%	-6.67	%	to	-2.91	%

	Hartford Capital Appreciation HLS Fund (Class IB)
December 31, 2018	2		$	13.92	to	$	13.92	$	23		0.80	%	0.10	%	to	0.10	%	-7.27	%	to	-7.27	%
December 31, 2017	1		$	15.01	to	$	15.01	$	17		0.87	%	0.10	%	to	0.10	%	21.69	%	to	21.69	%
December 31, 2016	1		$	12.33	to	$	12.33	$	14		1.05	%	0.10	%	to	0.10	%	5.14	%	to	5.14	%
December 31, 2015	1		$	11.73	to	$	11.73	$	10		1.16	%	0.10	%	to	0.10	%	-4.86	%	to	0.69	%
December 31, 2014	0	⁽¹⁾	$	11.65	to	$	11.65	$	4		0.83	%	0.10	%	to	0.10	%	-0.57	%	to	6.93	%

	Hartford Disciplined Equity HLS Fund (Class IB)
December 31, 2018	5		$	16.93	to	$	16.93	$	85		0.52	%	0.10	%	to	0.10	%	-2.33	%	to	-2.33	%
December 31, 2017	5		$	17.33	to	$	17.33	$	80		0.71	%	0.10	%	to	0.10	%	21.51	%	to	21.51	%
December 31, 2016	5		$	14.26	to	$	14.26	$	65		1.15	%	0.10	%	to	0.10	%	5.38	%	to	5.38	%
December 31, 2015	1		$	13.53	to	$	13.53	$	13		0.73	%	0.10	%	to	0.10	%	1.75	%	to	6.49	%
December 31, 2014	0		$	12.71	to	$	12.71	$	0	⁽¹⁾	0.04	%	0.10	%	to	0.10	%	5.02	%	to	15.75	%

	Hartford Dividend and Growth HLS Fund (Class IB)
December 31, 2018	32		$	15.45	to	$	15.45	$	502		2.00	%	0.10	%	to	0.10	%	-5.66	%	to	-5.66	%
December 31, 2017	24		$	16.38	to	$	16.38	$	392		2.24	%	0.10	%	to	0.10	%	17.99	%	to	17.99	%
December 31, 2016	12		$	13.88	to	$	13.88	$	166		2.84	%	0.10	%	to	0.10	%	14.47	%	to	14.47	%
December 31, 2015	3		$	12.12	to	$	12.12	$	33		1.39	%	0.10	%	to	0.10	%	-3.85	%	to	-1.51	%
December 31, 2014	5		$	12.31	to	$	12.31	$	58		3.18	%	0.10	%	to	0.10	%	2.52	%	to	12.57	%

	American Funds IS International Fund (Class 2)
December 31, 2018	103		$	10.37	to	$	11.70	$	1,106		2.79	%	0.10	%	to	0.25	%	-13.35	%	to	-11.18	%
December 31, 2017	38		$	11.97	to	$	13.48	$	485		2.11	%	0.10	%	to	0.25	%	31.82	%	to	32.01	%
December 31, 2016	7		$	9.08	to	$	10.21	$	70		1.87	%	0.10	%	to	0.25	%	3.27	%	to	3.43	%
December 31, 2015	4		$	8.79	to	$	9.87	$	35		1.98	%	0.10	%	to	0.25	%	-12.57	%	to	-4.62	%
December 31, 2014	2		$	10.35	to	$	10.35	$	20		1.72	%	0.10	%	to	0.10	%	-2.75	%	to	-2.75	%

	Franklin Income VIP Fund (Class 2)
December 31, 2018	32		$	10.76	to	$	12.17	$	369		4.37	%	0.10	%	to	0.25	%	-6.73	%	to	-4.40	%
December 31, 2017	23		$	11.27	to	$	12.73	$	278		4.35	%	0.10	%	to	0.25	%	9.40	%	to	9.56	%
December 31, 2016	13		$	10.30	to	$	11.62	$	148		4.40	%	0.10	%	to	0.25	%	13.74	%	to	13.91	%
December 31, 2015	3		$	9.06	to	$	10.20	$	34		3.60	%	0.10	%	to	0.25	%	-9.75	%	to	-7.15	%
December 31, 2014	5		$	10.99	to	$	10.99	$	52		0.05	%	0.10	%	to	0.10	%	-4.16	%	to	4.51	%

	Franklin Mutual Shares VIP Fund (Class 2)
December 31, 2018	8		$	10.35	to	$	12.39	$	90		2.66	%	0.10	%	to	0.25	%	-9.29	%	to	-9.16	%
December 31, 2017	7		$	11.41	to	$	13.63	$	80		2.42	%	0.10	%	to	0.25	%	8.08	%	to	8.24	%
December 31, 2016	5		$	10.56	to	$	12.60	$	56		2.28	%	0.10	%	to	0.25	%	15.77	%	to	15.94	%
December 31, 2015	2		$	9.12	to	$	10.86	$	21		2.72	%	0.10	%	to	0.25	%	-9.31	%	to	-5.03	%
December 31, 2014	0	⁽¹⁾	$	11.44	to	$	11.44	$	5		2.62	%	0.10	%	to	0.10	%	-1.25	%	to	7.02	%

	MFS® Total Return Bond Series (Initial Class)
December 31, 2018	73		$	10.48	to	$	11.37	$	791		3.69	%	0.10	%	to	0.25	%	-1.33	%	to	-0.12	%
December 31, 2017	50		$	10.63	to	$	11.50	$	551		3.60	%	0.10	%	to	0.25	%	4.20	%	to	4.35	%
December 31, 2016	33		$	10.20	to	$	11.02	$	352		3.73	%	0.10	%	to	0.25	%	3.97	%	to	4.13	%
December 31, 2015	8		$	9.81	to	$	10.59	$	84		4.05	%	0.10	%	to	0.25	%	-1.71	%	to	-0.40	%
December 31, 2014	3		$	10.63	to	$	10.63	$	27		2.85	%	0.10	%	to	0.10	%	0.94	%	to	5.74	%

A 70


Note 7:	Financial Highlights (continued)



	At the year ended										For the year ended
	Units (000s)		Unit Value Lowest — Highest					Net Assets (000s)			Investment Income Ratio*		Expense Ratio** Lowest — Highest					Total Return*** Lowest — Highest
	MFS® Value Series (Initial Class)
December 31, 2018	41		$	11.73	to	$	14.54	$	518		1.72	%	0.10	%	to	0.25	%	-11.10	%	to	-10.18	%
December 31, 2017	24		$	13.08	to	$	16.19	$	336		2.09	%	0.10	%	to	0.25	%	17.36	%	to	17.53	%
December 31, 2016	16		$	11.15	to	$	13.78	$	190		2.37	%	0.10	%	to	0.25	%	13.81	%	to	13.98	%
December 31, 2015	4		$	9.79	to	$	12.09	$	49		2.93	%	0.10	%	to	0.25	%	-2.81	%	to	-0.84	%
December 31, 2014	1		$	12.19	to	$	12.19	$	12		1.69	%	0.10	%	to	0.10	%	10.40	%	to	10.40	%

	Hartford Growth Opportunities HLS Fund (Class IB)
December 31, 2018	24		$	17.53	to	$	17.53	$	419		0.00	%	0.10	%	to	0.10	%	0.19	%	to	0.19	%
December 31, 2017	18		$	17.49	to	$	17.49	$	308		0.00	%	0.10	%	to	0.10	%	30.01	%	to	30.01	%
December 31, 2016	12		$	13.45	to	$	13.45	$	156		0.17	%	0.10	%	to	0.10	%	-0.87	%	to	-0.87	%
December 31, 2015	4		$	13.57	to	$	13.57	$	60		0.00	%	0.10	%	to	0.10	%	2.35	%	to	11.36	%
December 31, 2014	0	⁽¹⁾	$	12.19	to	$	12.19	$	2		0.00	%	0.10	%	to	0.10	%	4.26	%	to	13.71	%

	American Funds IS Blue Chip Income and Growth Fund (Class 2) (available May 1, 2014)
December 31, 2018	32		$	13.52	to	$	13.52	$	437		2.08	%	0.25	%	to	0.25	%	-12.16	%	to	-8.89	%
December 31, 2017	23		$	14.83	to	$	14.83	$	337		2.22	%	0.25	%	to	0.25	%	16.75	%	to	16.75	%
December 31, 2016	17		$	12.71	to	$	12.71	$	221		2.44	%	0.25	%	to	0.25	%	18.40	%	to	18.40	%
December 31, 2015	12		$	10.73	to	$	10.73	$	128		2.30	%	0.25	%	to	0.25	%	-3.17	%	to	-3.17	%
December 31, 2014	7		$	11.08	to	$	11.08	$	79		6.97	%	0.25	%	to	0.25	%	10.83	%	to	10.83	%

	Fidelity® VIP Index 500 Portfolio (Service Class 2) (available May 1, 2014)
December 31, 2018	103		$	14.26	to	$	14.26	$	1,470		1.85	%	0.25	%	to	0.25	%	-11.81	%	to	-4.97	%
December 31, 2017	64		$	15.01	to	$	15.01	$	967		1.84	%	0.25	%	to	0.25	%	21.10	%	to	21.10	%
December 31, 2016	42		$	12.39	to	$	12.39	$	517		1.77	%	0.25	%	to	0.25	%	11.30	%	to	11.30	%
December 31, 2015	25		$	11.13	to	$	11.13	$	275		2.93	%	0.25	%	to	0.25	%	0.83	%	to	0.83	%
December 31, 2014	8		$	11.04	to	$	11.04	$	87		4.12	%	0.25	%	to	0.25	%	10.41	%	to	10.41	%

	Invesco V.I. Growth and Income Fund (Series I) (available May 1, 2014)
December 31, 2018	34		$	12.24	to	$	12.24	$	418		2.27	%	0.25	%	to	0.25	%	-15.07	%	to	-13.60	%
December 31, 2017	26		$	14.17	to	$	14.17	$	374		1.53	%	0.25	%	to	0.25	%	14.03	%	to	14.03	%
December 31, 2016	18		$	12.43	to	$	12.43	$	222		1.22	%	0.25	%	to	0.25	%	19.40	%	to	19.40	%
December 31, 2015	12		$	10.41	to	$	10.41	$	120		3.23	%	0.25	%	to	0.25	%	-3.30	%	to	-3.30	%
December 31, 2014	8		$	10.76	to	$	10.76	$	86		0.74	%	0.25	%	to	0.25	%	7.84	%	to	7.84	%

	AST International Value Portfolio (available April 24, 2015)
December 31, 2018	407		$	9.21	to	$	9.49	$	3,834		0.00	%	0.10	%	to	0.90	%	-16.89	%	to	-11.48	%
December 31, 2017	453		$	11.08	to	$	11.33	$	5,093		0.00	%	0.10	%	to	0.90	%	21.72	%	to	22.69	%
December 31, 2016	450		$	9.11	to	$	9.25	$	4,140		0.00	%	0.10	%	to	0.90	%	-0.31	%	to	0.48	%
December 31, 2015	425		$	9.13	to	$	9.22	$	3,896		0.00	%	0.10	%	to	0.90	%	-9.14	%	to	-8.11	%
December 31, 2014	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%

	Calvert VP NASDAQ 100 Index Portfolio (Class F) (available August 20, 2018)
December 31, 2018	—	⁽¹⁾	$	8.58	to	$	8.58	$	—	⁽¹⁾	0.00	%	0.25	%	to	0.25	%	-14.14	%	to	-14.14	%
December 31, 2017	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%
December 31, 2016	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%
December 31, 2015	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%
December 31, 2014	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%

	Calvert VP S&P MidCap 400 Index Portfolio (Class F) (available August 20, 2018)
December 31, 2018	—	⁽¹⁾	$	8.30	to	$	8.30	$	—	⁽¹⁾	0.00	%	0.25	%	to	0.25	%	-17.31	%	to	-17.31	%
December 31, 2017	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%
December 31, 2016	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%
December 31, 2015	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%
December 31, 2014	—		$	—	to	$	—	$	—		0.00	%	0.00	%	to	0.00	%	0.00	%	to	0.00	%

A 71


Note 7:	Financial Highlights (continued)

__________

* These amounts represent the dividends, excluding distributions of capital gains, received by the subaccount from the underlying Portfolios, net of management fees assessed by the fund manager, divided by the average net assets. These ratios exclude those expenses, such as mortality and expense charges, that result in direct reductions in the unit values. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying Portfolios in which the subaccount invests.

** These amounts represent the annualized Contract expenses of the Account, consisting primarily of mortality and expense charges, for each period indicated. The ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to contract owner accounts through the redemption of units and expenses of the underlying Portfolios are excluded. Expense ratio is net of expense reimbursements. In the absence of expense reimbursements, the expense ratio would be higher.

*** These amounts represent the total returns for the periods indicated, including changes in the value of the underlying Portfolios, and reflect deductions for all items included in the expense ratio. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. Product designs within a subaccount with no activity during the period were excluded from the range of total returns for that period. Product designs within a subaccount which were offered after a fiscal year began are included in the range of total returns for that period, and their respective total returns may not correspond to the total returns of a product offering with a comparable expense ratio that was presented for the full period. Contract owners may experience different total returns based on their investment options. Subaccounts with a date notation indicate the effective date of that subaccount in the Account. Total returns for periods less than one year are not annualized. The total return is calculated for each of the five years in the period ended December 31, 2018 or from the effective date of the subaccount through the end of the reporting period. Total return may reflect expense reimbursements. In the absence of expense reimbursements, the total return would be lower.

(1)Amount is less than 1,000 units and/or $1,000 in net assets.

(2)Amount is less than 0.01%.


Note 8:	Charges and Expenses

The following represents the various charges and expenses of the Account which are paid to Pruco Life of New Jersey.

The expense ratio represents the annualized Contract expenses of the Account for the period indicated and includes those expenses that are charged through a reduction of the unit value, which consists solely of the mortality and expense risk charges. These fees range from an effective annual rate from 0% to 0.90%, and are applied daily against the net assets of each subaccount. Expenses of the underlying Portfolios and charges made directly to contract owner accounts through either the redemption of units or from premium payments are excluded.

Charges deducted from premium payments range from 0% to 22.5%. In addition, VAL2 and SVAL2 contracts also deduct a $2 premium processing charge for each premium paid. The percentage of the premium payment deducted consists of taxes attributable to premiums, any applicable sales charge, and any premium based administrative charge.

The charges made directly to the contract owner through the redemption of units depend on the product and the options or transactions selected by the contract owner. The following charges are made through the redemption of units.

•The Account charges from $0.00001 to $83.34 per $1,000 of basic insurance amount for the cost of insurance plus additional mortality for extra ratings of up to $2.08 per $1,000 of basic insurance amount.

A 72


Note 8:	Charges and Expenses (continued)

•The Account charges surrender fees that range from 0% to 100% of the sales load target premium, except for Protector based contracts (VULP⁽⁴⁾, SVULP, and MPVULP), where the fees range from $0 to $45.45 per $1,000 of basic insurance amount.

•The Account charges a guaranteed death benefit fee of $0.01 per $1,000 of face amount for VAL2 and SVAL2 contracts.

•The charge for withdrawals range from the lesser of $15 and 2% to the lesser of $25 and 2% of the withdrawal amount, except for PS3, SVUL2, PCP, PCP2⁽³⁾, VULP⁽⁴⁾, SVULP, MPVUL and MPVULP where the fee is up to $25.

•The Account charges monthly administrative fees that range from $0 to $30 per Contract plus $0 to $10.00 per $1,000 of basic insurance amount, although it may be less for subsequent increases.

• The Account charges up to $25 per change to the basic insurance amount.

⁽³⁾ Includes the 2014 and 2015 versions of the product.

⁽⁴⁾ Includes the 2014 and 2018 versions of the product.

Expense Reimbursement

Expenses, including a management fee charged by PGIM Investments, are incurred by each portfolio of The Prudential Series Fund. Pursuant to a prior merger agreement, the Prudential Government Money Market Portfolio, Prudential Diversified Bond Portfolio, Prudential Equity Portfolio, Prudential Flexible Managed Portfolio and Prudential Conservative Balanced Portfolio subaccounts of the Account are reimbursed by Pruco Life of New Jersey for expenses indirectly incurred through their investment in the respective portfolios of The Prudential Series Fund when such expenses exceed 0.40% of the average daily net assets of the respective portfolios of The Prudential Series Fund.


Note 9:	Other

Accumulation units-this is the basic valuation unit used to calculate the contract owner's interest allocated to the variable account.

Contract owner net payments-represent contract owner contributions under the Contracts net of applicable deductions, charges, and state premium taxes.

Policy loans-represent amounts borrowed by contract owners using the Contract as the security for the loan.

Policy loan repayments and interest-represent payments made by contract owners to reduce the total outstanding policy loan principal plus accrued interest.

Surrenders, withdrawals, and death benefits-are payments to contract owners and beneficiaries made under the terms of the Contracts, and amounts that contract owners have requested to be withdrawn or paid to them.

Net transfers between other subaccounts or fixed rate option-are amounts that contract owners have directed to be moved among subaccounts, including permitted transfers to and from the fixed rate option.

Miscellaneous transactions-amount represents primarily timing related adjustments to contract owner transactions, such as premiums, surrenders, transfers, etc. which are funded by the general account in order to maintain appropriate contract owner account balances.

Other charges-are various Contract level charges as described in Charges and Expenses in Note 8, which are assessed through the redemptions of units.

A 73

Report of Independent Registered Public Accounting Firm

To the Board of Directors of

Pruco Life Insurance Company of New Jersey and

the Contract Owners of Pruco Life of New Jersey Variable Appreciable Account

Opinions on the Financial Statements

We have audited the accompanying statements of net assets of each of the subaccounts of Pruco Life of New Jersey Variable Appreciable Account indicated in the table below as of the dates indicated in the table below, and the related statements of operations and of changes in net assets for each of the periods indicated in the table below, including the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of each of the subaccounts in the Pruco Life of New Jersey Variable Appreciable Account as of the dates indicated in the table below, and the results of each of their operations and the changes in each of their net assets for the periods indicated in the table below, in conformity with accounting principles generally accepted in the United States of America.



Prudential Government Money Market Portfolio (1)	The Dreyfus Sustainable U.S. Equity Portfolio, Inc. (Service Shares) (1)
Prudential Diversified Bond Portfolio (1)	Prudential Jennison 20/20 Focus Portfolio (Class I) (1)
Prudential Equity Portfolio (Class I) (1)	MFS® Utilities Series (Initial Class) (1)
Prudential Flexible Managed Portfolio (1)	Neuberger Berman AMT Sustainable Equity Portfolio (Class S) (1)
Prudential Conservative Balanced Portfolio (1)	AST T. Rowe Price Large-Cap Growth Portfolio (1)
Prudential High Yield Bond Portfolio (1)	AST BlackRock/Loomis Sayles Bond Portfolio (1)
Prudential Stock Index Portfolio (1)	AST T. Rowe Price Asset Allocation Portfolio (1)
Prudential Value Portfolio (Class I) (1)	AST Wellington Management Hedged Equity Portfolio (1)
Prudential Natural Resources Portfolio (Class I) (1)	AST Balanced Asset Allocation Portfolio (1)
Prudential Global Portfolio (1)	AST Preservation Asset Allocation Portfolio (1)
Prudential Government Income Portfolio (1)	AST Fidelity Institutional AM℠ Quantitative Portfolio (1)
Prudential Jennison Portfolio (Class I) (1)	AST Prudential Growth Allocation Portfolio (1)
Prudential Small Capitalization Stock Portfolio (1)	AST Advanced Strategies Portfolio (1)
T. Rowe Price International Stock Portfolio (1)	AST RCM World Trends Portfolio (1)
Janus Henderson VIT Research Portfolio (Institutional Shares) (1)	Dreyfus Investment Portfolios, MidCap Stock Portfolio (Service Shares) (1)
MFS® Growth Series (Initial Class) (1)	AST BlackRock Global Strategies Portfolio (1)
American Century VP Value Fund (Class I) (1)	TOPS® Aggressive Growth ETF Portfolio (Class 2) (1)
Franklin Small-Mid Cap Growth VIP Fund (Class 2) (1)	TOPS® Balanced ETF Portfolio (Class 2) (1)
Prudential SP Small Cap Value Portfolio (Class I) (1)	TOPS® Conservative ETF Portfolio (Class 2) (1)
Janus Henderson VIT Research Portfolio (Service Shares) (1)	TOPS® Growth ETF Portfolio (Class 2) (1)
SP Prudential U.S. Emerging Growth Portfolio (Class I) (1)	TOPS® Moderate Growth ETF Portfolio (Class 2) (1)
Prudential SP International Growth Portfolio (Class I) (1)	TOPS® Managed Risk Balanced ETF Portfolio (Class 2) (1)
Janus Henderson VIT Overseas Portfolio (Service Shares) (1)	TOPS® Managed Risk Growth ETF Portfolio (Class 2) (1)
Goldman Sachs VIT Small Cap Equity Insights Fund (Institutional Shares) (1)	TOPS® Managed Risk Moderate Growth ETF Portfolio (Class 2) (1)
M Large Cap Growth Fund (1)	American Funds IS Growth Fund (Class 2) (1)
M International Equity Fund (1)	American Funds IS Growth-Income Fund (Class 2) (1)
M Large Cap Value Fund (1)	Fidelity® VIP Contrafund® Portfolio (Service Class 2) (1)
AST Cohen & Steers Realty Portfolio (1)	Fidelity® VIP Mid Cap Portfolio (Service Class 2) (1)

A 74



AST J.P. Morgan Strategic Opportunities Portfolio (1)	Templeton Growth VIP Fund (Class 2) (1)
AST T. Rowe Price Large-Cap Value Portfolio (1)	Hartford Capital Appreciation HLS Fund (Class IB) (1)
AST Small-Cap Growth Opportunities Portfolio (1)	Hartford Disciplined Equity HLS Fund (Class IB) (1)
AST Small-Cap Value Portfolio (1)	Hartford Dividend and Growth HLS Fund (Class IB) (1)
AST Goldman Sachs Mid-Cap Growth Portfolio (1)	American Funds IS International Fund (Class 2) (1)
AST Loomis Sayles Large-Cap Growth Portfolio (1)	Franklin Income VIP Fund (Class 2) (1)
AST MFS Growth Portfolio (1)	Franklin Mutual Shares VIP Fund (Class 2) (1)
AST BlackRock Low Duration Bond Portfolio (1)	MFS® Total Return Bond Series (Initial Class) (1)
AST T. Rowe Price Natural Resources Portfolio (1)	MFS® Value Series (Initial Class) (1)
AST MFS Global Equity Portfolio (1)	Hartford Growth Opportunities HLS Fund (Class IB) (1)
AST J.P. Morgan International Equity Portfolio (1)	American Funds IS Blue Chip Income and Growth Fund (Class 2) (1)
AST Templeton Global Bond Portfolio (1)	Fidelity® VIP Index 500 Portfolio (Service Class 2) (1)
M Capital Appreciation Fund (1)	Invesco V.I. Growth and Income Fund (Series I) (1)
American Century VP Mid Cap Value Fund (Class I) (1)	AST International Value Portfolio (1)
AST Hotchkis & Wiley Large-Cap Value Portfolio (1)	Calvert VP NASDAQ 100 Index Portfolio (Class F) (2)
AST Small-Cap Growth Portfolio (1)	Calvert VP S&P MidCap 400 Index Portfolio (Class F) (2)
(1) Statement of net assets as of December 31, 2018, statement of operations for the year ended December 31, 2018, and statement of changes in net assets for the years ended December 31, 2018 and 2017.
(2) Statement of net assets as of December 31, 2018, and statement of operations and statement of changes in net assets for the period August 20, 2018 (commencement of operations) through December 31, 2018.

Basis for Opinions

These financial statements are the responsibility of the management of Pruco Life Insurance Company. Our responsibility is to express an opinion on the subaccounts’ financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the subaccounts in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of December 31, 2018 by correspondence with the transfer agents of the investee mutual funds. We believe that our audits provide a reasonable basis for our opinions.

/s/ PricewaterhouseCoopers LLP

New York, New York

April 11, 2019

We have served as the auditor of one or more of the subaccounts in Pruco Life of New Jersey Variable Appreciable Account since 1996.

A 75

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

FINANCIAL STATEMENTS INDEX



	Page
Management’s Annual Report on Internal Control Over Financial Reporting	B-2
Statements of Financial Position as of December 31, 2018 and 2017	B-3
Statements of Operations and Comprehensive Income for the years ended December 31, 2018, 2017 and 2016	B-4
Statements of Equity for the years ended December 31, 2018, 2017 and 2016	B-5
Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016	B-6
Notes to Financial Statements:	B-7
1 Business and Basis of Presentation	B-7
2 Significant Accounting Policies and Pronouncements	B-8
3 Investments	B-25
4 Derivative Instruments	B-35
5 Fair Value of Assets and Liabilities	B-41
6 Deferred Policy Acquisition Costs	B-53
7 Policyholders’ Liabilities	B-53
8 Certain Long-duration Contracts With Guarantees	B-54
9 Reinsurance	B-58
10 Income Taxes	B-61
11 Equity	B-64
12 Statutory Net Income and Surplus and Dividend Restriction	B-68
13 Related Party Transactions	B-68
14 Commitments, Contingent Liabilities and Litigation and Regulatory Matters	B-71
15 Quarterly Results of Operations (Unaudited)	B-73
Report of Independent Registered Public Accounting Firm	B-74

B-1

Management’s Annual Report on Internal Control Over Financial Reporting

Management of Pruco Life Insurance Company of New Jersey (the “Company”) is responsible for establishing and maintaining adequate internal control over financial reporting. Management conducted an assessment of the effectiveness, as of December 31, 2018, of the Company’s internal control over financial reporting, based on the framework established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on our assessment under that framework, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2018.

Our internal control over financial reporting is a process designed by or under the supervision of our principal executive and principal financial officers to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and the directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on our financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

This Annual Report does not include an attestation report of the Company’s registered public accounting firm, PricewaterhouseCoopers LLP, regarding the internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this Annual Report.

March 7, 2019

B-2

Pruco Life Insurance Company of New Jersey

Statements of Financial Position

As of December 31, 2018 and 2017 (in thousands, except share amounts)



	December 31, 2018			December 31, 2017
ASSETS
Fixed maturities, available for sale, at fair value (amortized cost: 2018–$1,297,892 ; 2017–$1,204,166)	$	1,277,824		$	1,261,237
Fixed maturities, trading, at fair value (amortized cost: 2018–$7,446; 2017–$7,446)(1)	$	5,770		$	6,643
Equity securities, at fair value (cost: 2018–$8,136 ; 2017–$8,114)(1)	9,870			10,842
Policy loans	206,448			193,244
Commercial mortgage and other loans	118,636			121,796
Other invested assets (includes $10,673 and $726 measured at fair value at December 31, 2018 and December 31, 2017, respectively)(1)	58,413			46,803
Total investments	1,676,961			1,640,565
Cash and cash equivalents	70,441			44,618
Deferred policy acquisition costs	165,478			145,451
Accrued investment income	17,764			16,580
Reinsurance recoverables	2,723,518			2,480,848
Receivables from parent and affiliates	40,388			43,051
Income taxes receivable	19,134			0
Other assets	23,973			27,328
Separate account assets	13,382,345			14,245,159
TOTAL ASSETS	$	18,120,002		$	18,643,600
LIABILITIES AND EQUITY
LIABILITIES
Policyholders' account balances	$	2,314,958		$	2,083,582
Future policy benefits	1,820,092			1,707,184
Cash collateral for loaned securities	2,702			15,208
Income taxes payable	0			241
Payables to parent and affiliates	20,413			22,236
Other liabilities	134,771			103,632
Separate account liabilities	13,382,345			14,245,159
Total liabilities	$	17,675,281		$	18,177,242
COMMITMENTS AND CONTINGENT LIABILITIES (See Note 14)
EQUITY
Common stock ($5 par value; 400,000 shares authorized; issued and outstanding)	2,000			2,000
Additional paid-in capital	213,261			211,961
Retained earnings	243,827			218,067
Accumulated other comprehensive income	(14,367		)	34,330
Total equity	444,721			466,358
TOTAL LIABILITIES AND EQUITY	$	18,120,002		$	18,643,600

(1) Prior period amounts have been reclassified to conform to current period presentation. See "Adoption of ASU 2016-01" in Note 2 for details.

See Notes to Financial Statements

B-3

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Statements of Operations and Comprehensive Income

Years Ended December 31, 2018, 2017 and 2016 (in thousands)



	2018			2017			2016
REVENUES
Premiums	$	13,007		$	13,967		$	(34,675	)
Policy charges and fee income	62,567			44,203			66,546
Net investment income	67,811			66,651			72,025
Asset administration fees	5,356			9,075			14,358
Other income	1,004			4,111			2,404
Realized investment gains (losses), net:
Other-than-temporary impairments on fixed maturity securities	(125		)	(80		)	0
Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income	0			0			0
Other realized investment gains (losses), net	(9,148		)	(13,958		)	88,428
Total realized investment gains (losses), net	(9,273		)	(14,038		)	88,428
Total revenues	140,472			123,969			209,086
BENEFITS AND EXPENSES
Policyholders’ benefits	19,829			12,255			1,985
Interest credited to policyholders’ account balances	35,936			32,959			43,928
Amortization of deferred policy acquisition costs	15,972			12,538			47,227
General, administrative and other expenses	37,507			36,898			22,511
Total benefits and expenses	109,244			94,650			115,651
INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES	31,228			29,319			93,435
Total income tax expense (benefit)	(53		)	(5,938		)	14,235
NET INCOME (LOSS)	$	31,281		$	35,257		$	79,200
Other comprehensive income (loss), before tax:
Foreign currency translation adjustments	(1,187		)	43			(1		)
Net unrealized investment gains (losses)	(67,692		)	32,210			586
Total	(68,879		)	32,253			585
Less: Income tax expense (benefit) related to other comprehensive income (loss)	(14,464		)	10,084			205
Other comprehensive income (loss), net of tax	(54,415		)	22,169			380
Comprehensive income (loss)	$	(23,134	)	$	57,426		$	79,580

See Notes to Financial Statements

B-4

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Statements of Equity

Years Ended December 31, 2018, 2017 and 2016 (in thousands)



	Common Stock		Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Income			Total Equity
Balance, December 31, 2015	$	2,000	$	208,314	$	444,514		$	11,781		$	666,609
Contributed capital			1,300								1,300
Dividend to parent					(240,904		)				(240,904		)
Contributed (distributed) capital- parent/child asset transfers			172								172
Comprehensive income:
Net income (loss)					79,200						79,200
Other comprehensive income (loss), net of tax								380			380
Total comprehensive income (loss)											79,580
Balance, December 31, 2016	$	2,000	$	209,786	$	282,810		$	12,161		$	506,757
Contributed capital			1,300								1,300
Dividend to parent					(100,000		)				(100,000		)
Contributed (distributed) capital- parent/child asset transfers			875								875
Comprehensive income:
Net income (loss)					35,257						35,257
Other comprehensive income (loss), net of tax								22,169			22,169
Total comprehensive income (loss)											57,426
Balance, December 31, 2017	$	2,000	$	211,961	$	218,067		$	34,330		$	466,358
Cumulative effect of adoption of ASU 2016-01					372			(175		)	197
Cumulative effect of adoption of ASU 2018-02					(5,893		)	5,893			0
Contributed capital			1,300								1,300
Dividend to parent
Comprehensive income:
Net income (loss)					31,281						31,281
Other comprehensive income (loss), net of tax								(54,415		)	(54,415		)
Total comprehensive income (loss)											(23,134		)
Balance, December 31, 2018	$	2,000	$	213,261	$	243,827		$	(14,367	)	$	444,721

See Notes to Financial Statements

B-5

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Statements of Cash Flows

Years Ended December 31, 2018, 2017 and 2016 (in thousands)



	2018			2017			2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	31,281		$	35,257		$	79,200
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Policy charges and fee income	(21,780		)	(9,816		)	29,552
Interest credited to policyholders’ account balances	35,936			32,959			43,928
Realized investment (gains) losses, net	9,273			14,038			(88,428		)
Amortization and other non-cash items	(7,850		)	(10,893		)	(15,720		)
Change in:
Future policy benefits	201,654			192,407			183,130
Reinsurance recoverables	(209,954		)	(194,653		)	(176,279		)
Accrued investment income	(1,184		)	(751		)	815
Net payables to/receivables from parent and affiliates	856			2,978			(216		)
Deferred policy acquisition costs	(14,771		)	(12,060		)	17,274
Income taxes	(4,963		)	(6,323		)	(1,658		)
Derivatives, net	(4,777		)	7,191			(2,216		)
Other, net	21,047			(1,314		)	(5,433		)
Cash flows from (used in) operating activities	34,768			49,020			63,949
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale/maturity/prepayment of:
Fixed maturities, available-for-sale	73,692			191,284			311,143
Fixed maturities, trading(1)	0			0			527
Equity securities(1)	1,939			5			11,139
Policy loans	23,009			21,743			22,090
Ceded policy loans	(1,990		)	(2,015		)	(1,437		)
Short-term investments	0			32,985			25,130
Commercial mortgage and other loans	4,209			55,580			42,051
Other invested assets(1)	2,502			2,875			2,165
Payments for the purchase/origination of:
Fixed maturities, available-for-sale	(167,311		)	(263,909		)	(596,327		)
Fixed maturities, trading(1)	0			0			0
Equity securities(1)	(2,002		)	(2,000		)	(2,000		)
Policy loans	(28,537		)	(20,053		)	(17,496		)
Ceded policy loans	2,734			2,461			3,114
Short-term investments	0			(21,981		)	(35,419		)
Commercial mortgage and other loans	(1,595		)	(15,623		)	(14,247		)
Other invested assets(1)	(7,186		)	(4,444		)	(1,102		)
Notes receivable from parent and affiliates, net	455			331			2,318
Derivatives, net	161			213			3,895
Other, net	(282		)	(402		)	0
Cash flows from (used in) investing activities	(100,202		)	(22,950		)	(244,456		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Policyholders’ account deposits	555,153			503,455			437,936
Ceded policyholders’ account deposits	(337,536		)	(332,727		)	(278,102		)
Policyholders’ account withdrawals	(311,159		)	(268,989		)	(206,474		)
Ceded policyholders’ account withdrawals	187,237			155,696			95,896
Net change in securities sold under agreement to repurchase and cash collateral for loaned securities	(12,505		)	153			12,024
Dividend to parent	0			(100,000		)	0
Contributed capital	0			0			15,515
Contributed (distributed) capital - parent/child asset transfers	0			1,347			267
Drafts outstanding	10,067			2,629			(308		)
Cash flows from (used in) financing activities	91,257			(38,436		)	76,754
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	25,823			(12,366		)	(103,753		)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	44,618			56,984			160,737
CASH AND CASH EQUIVALENTS, END OF YEAR	$	70,441		$	44,618		$	56,984
SUPPLEMENTAL CASH FLOW INFORMATION
Income taxes paid (refund)	$	4,910		$	346		$	15,844
Interest paid	$	5		$	3		$	1,128

(1) Prior period amounts have been reclassified to conform to current period presentation. See Note 2 for details.

Significant Non-Cash Transactions

Cash flows from investing and financing activities for the year ended December 31, 2016 excludes certain non-cash transactions related to the Variable Annuities Recapture. See Note 1 for additional information.

See Notes to Financial Statements

B-6

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements

1. BUSINESS AND BASIS OF PRESENTATION

Pruco Life Insurance Company of New Jersey (“PLNJ”) is a wholly-owned subsidiary of Pruco Life Insurance Company (“Pruco Life”), which in turn is a wholly-owned subsidiary of The Prudential Insurance Company of America (“Prudential Insurance”). Prudential Insurance is a direct wholly-owned subsidiary of Prudential Financial, Inc. (“Prudential Financial”). PLNJ is a stock life insurance company organized in 1982 under the laws of the State of New Jersey. It is licensed to sell life insurance and annuities in New Jersey and New York only, and sells such products primarily through affiliated and unaffiliated distributors.

PLNJ had one subsidiary, formed in 2009 for the purpose of holding certain commercial loans and other investments which ceased operations and was dissolved as of December 31, 2018. Financial information for 2017 and 2016 is shown on a consolidated basis.

Variable Annuities Recapture

Through March 31, 2016, the Company reinsured the majority of its variable annuity living benefit guarantees to its affiliated companies, Pruco Reinsurance, Ltd. ("Pruco Re") and Pruco Life. Effective April 1, 2016, the Company recaptured the risks related to its variable annuity living benefit guarantees that were previously reinsured to Pruco Re and Pruco Life. In addition, the Company reinsured the variable annuity base contracts, along with the living benefit guarantees, to Prudential Insurance under a coinsurance and modified coinsurance agreement. This reinsurance agreement covers new and in force business. The product risks related to the reinsured business are being managed in Prudential Insurance. In addition, the living benefit hedging program related to the reinsured living benefit guarantees is being managed within Prudential Insurance. These series of transactions are collectively referred to as the "Variable Annuities Recapture".

As part of the Variable Annuities Recapture, the Company received invested assets of $0.4 billion as consideration from Pruco Re, which is equivalent to the amount of statutory reserve credit taken as of March 31, 2016 and unwound the associated reinsurance recoverable of $0.5 billion. As a result, the Company recognized a loss of $0.1 billion immediately.

As part of the Variable Annuities Recapture, the Company transferred invested assets of $0.7 billion to Prudential Insurance and established reinsurance recoverables of $1 billion. In addition, the Company received ceding commissions of $0.4 billion from Prudential Insurance, of which $0.1 billion were in the form of reassignment of debt to Prudential Insurance. Also, the Company unwound its deferred policy acquisition costs ("DAC") and deferred sales inducements ("DSI") balances related to its variable annuity contracts as of March 31, 2016, which was equivalent to the ceding commission. For the reinsurance of the variable annuity base contracts, the Company recognized a loss of $23 million, which was deferred and will subsequently be amortized through "General, administrative and other expenses". For the reinsurance of the living benefit guarantees, the Company recognized a benefit of $0.3 billion immediately since the reinsurance contract is accounted for as a free-standing derivative.

The Company also paid a dividend of $0.2 billion to Pruco Life, which was ultimately distributed to Prudential Financial.

B-7

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The impact of these transactions on the Statements of Operations and Comprehensive Income (Loss) was as follows:



Day 1 Impact of the Variable Annuities Recapture(1)	Impacts of Recapture			Impacts of Reinsurance			Total Impacts
	(in millions)
REVENUES
Premiums	$	0		$	(48	)	$	(48	)
Realized investment gains (losses), net	(137		)	268			131
TOTAL REVENUES	(137		)	220			83
BENEFITS AND EXPENSES
Policyholders' benefits	0			(26		)	(26		)
General, administrative and other expenses	0			(23		)	(23		)
TOTAL BENEFITS AND EXPENSES	0			(49		)	(49		)
INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES	(137		)	269			132
Income tax expense (benefit)	(28		)	55			27
NET INCOME (LOSS)	$	(109	)	$	214		$	105


(1)	Day 1 Significant Non-Cash Transactions:


•	Consideration transferred includes non-cash activities of $0.7 billion for asset transfers to Prudential Insurance related to the reinsurance transaction, partially offset by $0.4 billion of assets received related to the recapture transaction with Pruco Re.


•	The Company recognized ceding commissions of $0.4 billion of which $0.1 billion was in the form of reassignment of debt to Prudential Insurance.


•	Retained earnings includes dividends of $0.3 billion to Pruco Life, and ultimately distributed to Prudential Financial as part of the Variable Annuities Recapture.

Basis of Presentation

The Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Intercompany balances and transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The most significant estimates include those used in determining DAC and related amortization; amortization of DSI; valuation of investments including derivatives and the recognition of other-than-temporary impairments (“OTTI”); future policy benefits including guarantees; reinsurance recoverables; provision for income taxes and valuation of deferred tax assets; and accruals for contingent liabilities, including estimates for losses in connection with unresolved legal and regulatory matters.

Reclassifications

Certain amounts in prior periods have been reclassified to conform to the current period presentation.

2. SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS

ASSETS

Fixed maturities, available-for-sale, at fair value are comprised of bonds, notes and redeemable preferred stock. Fixed maturities classified as “available-for-sale” are carried at fair value. See Note 5 for additional information regarding the determination of fair value. The associated unrealized gains and losses, net of tax, and the effect on DAC, DSI, future policy benefits, reinsurance recoverables, and policyholders’ account balances that would result from the realization of unrealized gains and losses, are included in “Accumulated other comprehensive income (loss)” (“AOCI”). The purchased cost of fixed maturities is adjusted for amortization of premiums and accretion of discounts to maturity or, if applicable, call date.

B-8

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Interest income, and amortization of premium and accretion of discount are included in “Net investment income” under the effective yield method. Additionally, prepayment premiums are also included in “Net investment income”. For mortgage-backed and asset-backed securities, the effective yield is based on estimated cash flows, including interest rate and prepayment assumptions based on data from widely accepted third-party data sources or internal estimates. In addition to interest rate and prepayment assumptions, cash flow estimates also vary based on other assumptions regarding the underlying collateral, including default rates and changes in value. These assumptions can significantly impact income recognition and the amount of OTTI recognized in earnings and other comprehensive income. For high credit quality mortgage-backed and asset-backed securities (those rated AA or above), cash flows are provided quarterly, and the amortized cost and effective yield of the securities are adjusted as necessary to reflect historical prepayment experience and changes in estimated future prepayments. The adjustments to amortized cost are recorded as a charge or credit to "Net investment income" in accordance with the retrospective method. For mortgage-backed and asset-backed securities rated below AA or those for which an OTTI has been recorded, the effective yield is adjusted prospectively for any changes in estimated cash flows. See the discussion below on realized investment gains and losses for a description of the accounting for impairments.

Fixed maturities, trading, at fair value consists of fixed maturities that are carried at fair value. Realized and unrealized gains and losses on these investments are reported in “Other income (loss),” and interest and dividend income from these investments is reported in “Net investment income”.

Equity securities, at fair value is comprised of common stock and mutual fund shares, which are carried at fair value. Realized and unrealized gains and losses on these investments are reported in “Other income (loss),” and dividend income is reported in “Net investment income” on the ex-dividend date.

Policy loans represent funds loaned to policyholders up to the cash surrender value of the associated insurance policies and are carried at the unpaid principal balances due to the Company from the policyholders. Interest income on policy loans is recognized in “Net investment income” at the contract interest rate when earned. Policy loans are fully collateralized by the cash surrender value of the associated insurance policies.

Commercial mortgage and other loans consist of commercial mortgage loans and agricultural property loans. Commercial mortgage and other loans held for investment are generally carried at unpaid principal balance, net of unamortized deferred loan origination fees and expenses and net of an allowance for losses. Commercial mortgage and other loans acquired, including those related to the acquisition of a business, are recorded at fair value when purchased, reflecting any premiums or discounts to unpaid principal balances. Interest income, and the amortization of the related premiums or discounts, are included in “Net investment income” under the effective yield method. Prepayment fees are also included in “Net investment income”.

Impaired loans include those loans for which it is probable that amounts due will not all be collected according to the contractual terms of the loan agreement. The Company defines “past due” as principal or interest not collected at least 30 days past the scheduled contractual due date. Interest received on loans that are past due, including impaired and non-impaired loans as well as loans that were previously modified in a troubled debt restructuring, is either applied against the principal or reported as net investment income based on the Company’s assessment as to the collectability of the principal. See Note 3 for additional information about the Company’s past due loans.

The Company discontinues accruing interest on loans after the loans become 90 days delinquent as to principal or interest payments, or earlier when the Company has doubts about collectability. When the Company discontinues accruing interest on a loan, any accrued but uncollectible interest on the loan and other loans backed by the same collateral, if any, is charged to interest income in the same period. Generally, a loan is restored to accrual status only after all delinquent interest and principal are brought current and, in the case of loans where the payment of interest has been interrupted for a substantial period, or the loan has been modified, a regular payment performance has been established.

The Company reviews the performance and credit quality of the commercial mortgage and other loan portfolio on an on-going basis. Loans are placed on watch list status based on a predefined set of criteria and are assigned one of two categories. Loans are classified as “closely monitored” when it is determined that there is a collateral deficiency or other credit events that may lead to a potential loss of principal or interest. Loans “not in good standing” are those loans where the Company has concluded that there is a high probability of loss of principal, such as when the loan is delinquent or in the process of foreclosure. As described below, in determining the allowance for losses, the Company evaluates each loan on the watch list to determine if it is probable that amounts due will not be collected according to the contractual terms of the loan agreement.

B-9

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Loan-to-value and debt service coverage ratios are measures commonly used to assess the quality of commercial mortgage loans. The loan-to-value ratio compares the amount of the loan to the fair value of the underlying property collateralizing the loan, and is commonly expressed as a percentage. Loan-to-value ratios greater than 100% indicate that the loan amount exceeds the collateral value. A loan-to-value ratio less than 100% indicates an excess of collateral value over the loan amount. The debt service coverage ratio compares a property’s net operating income to its debt service payments. Debt service coverage ratios less than 1.0 times indicate that property operations do not generate enough income to cover the loan’s current debt payments. A debt service coverage ratio greater than 1.0 times indicates an excess of net operating income over the debt service payments. The values utilized in calculating these ratios are developed as part of the Company’s periodic review of the commercial mortgage loan and agricultural property loan portfolios, which includes an internal appraisal of the underlying collateral value. The Company’s periodic review also includes a quality re-rating process, whereby the internal quality rating originally assigned at underwriting is updated based on current loan, property and market information using a proprietary quality rating system. The loan-to-value ratio is the most significant of several inputs used to establish the internal credit rating of a loan which in turn drives the allowance for losses. Other key factors considered in determining the internal credit rating include debt service coverage ratios, amortization, loan term, and estimated market value growth rate and volatility for the property type and region. See Note 3 for additional information related to the loan-to-value ratios and debt service coverage ratios related to the Company’s commercial mortgage and agricultural loan portfolios.

The allowance for losses includes a loan specific reserve for each impaired loan that has a specifically identified loss and a portfolio reserve for probable incurred but not specifically identified losses. For impaired commercial mortgage and other loans, the allowances for losses are determined based on the present value of expected future cash flows discounted at the loan’s effective interest rate, or based upon the fair value of the collateral if the loan is collateral dependent. The portfolio reserves for probable incurred but not specifically identified losses in the commercial mortgage and agricultural loan portfolios consider the current credit composition of the portfolio based on an internal quality rating as described above. The portfolio reserves are determined using past loan experience, including historical credit migration, loss probability and loss severity factors by property type. These factors are reviewed and updated as appropriate.

The allowance for losses on commercial mortgage and other loans can increase or decrease from period to period based on the factors noted above. “Realized investment gains (losses), net” includes changes in the allowance for losses. “Realized investment gains (losses), net” also includes gains and losses on sales, certain restructurings, and foreclosures.

When a commercial mortgage or other loan is deemed to be uncollectible, any specific valuation allowance associated with the loan is reversed and a direct write down of the carrying amount of the loan is made. The carrying amount of the loan is not adjusted for subsequent recoveries in value.

Commercial mortgage and other loans are occasionally restructured in a troubled debt restructuring. These restructurings generally include one or more of the following: full or partial payoffs outside of the original contract terms; changes to interest rates; extensions of maturity; or additions or modifications to covenants. Additionally, the Company may accept assets in full or partial satisfaction of the debt as part of a troubled debt restructuring. When restructurings occur, they are evaluated individually to determine whether the restructuring or modification constitutes a “troubled debt restructuring” as defined by authoritative accounting guidance. If the borrower is experiencing financial difficulty and the Company has granted a concession, the restructuring, including those that involve a partial payoff or the receipt of assets in full satisfaction of the debt is deemed to be a troubled debt restructuring. Based on the Company’s credit review process described above, these loans generally would have been deemed impaired prior to the troubled debt restructuring, and specific allowances for losses would have been established prior to the determination that a troubled debt restructuring has occurred.

In a troubled debt restructuring where the Company receives assets in full satisfaction of the debt, any specific valuation allowance is reversed and a direct write-down of the loan is recorded for the amount of the allowance, and any additional loss, net of recoveries, or any gain is recorded for the difference between the fair value of the assets received and the recorded investment in the loan. When assets are received in partial settlement, the same process is followed, and the remaining loan is evaluated prospectively for impairment based on the credit review process noted above. When a loan is restructured in a troubled debt restructuring, the impairment of the loan is remeasured using the modified terms and the loan’s original effective yield, and the allowance for loss is adjusted accordingly. Subsequent to the modification, income is recognized prospectively based on the modified terms of the loans in accordance with the income recognition policy noted above. Additionally, the loan continues to be subject to the credit review process noted above.

In situations where a loan has been restructured in a troubled debt restructuring and the loan has subsequently defaulted, this factor is considered when evaluating the loan for a specific allowance for losses in accordance with the credit review process noted above.

See Note 3 for additional information about commercial mortgage and other loans that have been restructured in a troubled debt restructuring.

B-10

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Other invested assets consist of the Company’s non-coupon investments in Limited Partnerships and Limited Liability Companies ("LPs/LLCs")(other than operating joint ventures) and derivative assets. LPs/LLCs interests are accounted for using either the equity method of accounting, or at fair value with changes in fair value reported in “Other income (loss)”. The Company’s income from investments in LPs/LLCs accounted for using the equity method, other than the Company’s investments in operating joint ventures, is included in “Net investment income”. The carrying value of these investments is written down, or impaired, to fair value when a decline in value is considered to be other-than-temporary. In applying the equity method (including assessment for OTTI), the Company uses financial information provided by the investee, generally on a one to three-month lag. For the investments reported at fair value with changes in fair value reported in current earnings, the associated realized and unrealized gains and losses are reported in “Other income (loss)”.

Realized investment gains (losses) are computed using the specific identification method. Realized investment gains and losses are generated from numerous sources, including the sales of fixed maturity securities, investments in joint ventures and limited partnerships and other types of investments, as well as adjustments to the cost basis of investments for net OTTI recognized in earnings. Realized investment gains and losses also reflect changes in the allowance for losses on commercial mortgage and other loans, and fair value changes on embedded derivatives and free-standing derivatives that do not qualify for hedge accounting treatment. See “Derivative Financial Instruments” below for additional information regarding the accounting for derivatives.

The Company’s available-for-sale securities with unrealized losses are reviewed quarterly to identify OTTI in value. In evaluating whether a decline in value is other-than-temporary, the Company considers several factors including, but not limited to the following: (1) the extent and the duration of the decline; (2) the reasons for the decline in value (credit event, currency or interest-rate related, including general credit spread widening); and (3) the financial condition of and near-term prospects of the issuer.

An OTTI is recognized in earnings for a debt security in an unrealized loss position when the Company either (1) has the intent to sell the debt security or (2) it is more likely than not will be required to sell the debt security before its anticipated recovery. For all debt securities in unrealized loss positions that do not meet either of these two criteria, the Company analyzes its ability to recover the amortized cost by comparing the net present value of projected future cash flows with the amortized cost of the security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. The Company may use the estimated fair value of collateral as a proxy for the net present value if it believes that the security is dependent on the liquidation of collateral for recovery of its investment. If the net present value is less than the amortized cost of the investment, an OTTI is recognized.

When an OTTI of a debt security has occurred, the amount of the OTTI recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis. If the debt security meets either of these two criteria, the OTTI recognized in earnings is equal to the entire difference between the security’s amortized cost basis and its fair value at the impairment measurement date. For OTTI of debt securities that do not meet these criteria, the net amount recognized in earnings is equal to the difference between the amortized cost of the debt security and its net present value calculated as described above. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in “Other comprehensive income (loss)” (“OCI”). Unrealized gains or losses on securities for which an OTTI has been recognized in earnings is tracked as a separate component of AOCI.

The split between the amount of an OTTI recognized in OCI and the net amount recognized in earnings for debt securities is driven principally by assumptions regarding the amount and timing of projected cash flows. For mortgage-backed and asset-backed securities, cash flow estimates consider the payment terms of the underlying assets backing a particular security, including interest rate and prepayment assumptions based on data from widely accepted third-party data sources or internal estimates. In addition to interest rate and prepayment assumptions, cash flow estimates also include other assumptions regarding the underlying collateral including default rates and recoveries which vary based on the asset type and geographic location, as well as the vintage year of the security. For structured securities, the payment priority within the tranche structure is also considered. For all other debt securities, cash flow estimates are driven by assumptions regarding probability of default and estimates regarding timing and amount of recoveries associated with a default. The Company has developed these estimates using information based on its historical experience as well as using market observable data, such as industry analyst reports and forecasts, sector credit ratings and other data relevant to the collectability of a security, such as the general payment terms of the security and the security’s position within the capital structure of the issuer.

The new cost basis of an impaired security is not adjusted for subsequent increases in estimated fair value. In periods subsequent to the recognition of an OTTI, the impaired security is accounted for as if it had been purchased on the measurement date of the impairment. For debt securities, the discount (or reduced premium) based on the new cost basis may be accreted into net investment income in future periods, including increases in cash flow on a prospective basis. In certain cases where there are decreased cash flow expectations, the security is reviewed for further cash flow impairments.

B-11

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Unrealized investment gains and losses are also considered in determining certain other balances, including DAC, DSI, certain future policy benefits, reinsurance recoverables, policyholders’ account balances and deferred tax assets or liabilities. These balances are adjusted, as applicable, for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. Each of these balances is discussed in greater detail below.

Cash and cash equivalents include cash on hand, amounts due from banks, certain money market investments, funds managed similar to regulated money market funds, other debt instruments with maturities of three months or less when purchased, other than cash equivalents that are included in "Fixed maturities, available-for-sale, at fair value,” and receivables related to securities purchased under agreements to resell (see also "Securities sold under agreements to purchase" below.) The Company also engages in overnight borrowing and lending of funds with Prudential Financial and affiliates which are considered cash and cash equivalents.

Deferred policy acquisition costs are related directly to the successful acquisition of new and renewal insurance and annuity business that have been deferred to the extent such costs are deemed recoverable from future profits. Such DAC primarily includes commissions, costs of policy issuance and underwriting, and certain other expenses that are directly related to successfully negotiated contracts. In each reporting period, capitalized DAC is amortized to “Amortization of DAC”, net of the accrual of imputed interest on DAC balances. DAC is subject to periodic recoverability testing. DAC, for applicable products, is adjusted for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI.

DAC related to universal and variable life products and fixed and variable deferred annuity products are generally deferred and amortized over the expected life of the contracts in proportion to gross profits arising principally from investment margins, mortality and expense margins, and surrender charges, based on historical and anticipated future experience, which is updated periodically. The Company uses a reversion to the mean approach for equities to derive future equity return assumptions. However, if the projected equity return calculated using this approach is greater than the maximum equity return assumption, the maximum equity return is utilized. Gross profits also include impacts from the embedded derivatives associated with certain of the optional living benefit features of the Company’s variable annuity contracts and related hedging activities. In calculating gross profits, profits and losses related to contracts issued by the Company that are reported in affiliated legal entities other than the Company as a result of, for example, reinsurance agreements with those affiliated entities are also included. The Company is an indirect subsidiary of Prudential Financial, an United States Securities and Exchange Commission (the "SEC") registrant, and has extensive transactions and relationships with other subsidiaries of Prudential Financial, including reinsurance agreements, as described in Note 9. Incorporating all product-related profits and losses in gross profits, including those that are reported in affiliated legal entities, produces a DAC amortization pattern representative of the total economics of the products. Total gross profits include both actual gross profits and estimates of gross profits for future periods. The Company regularly evaluates and adjusts DAC balances with a corresponding charge or credit to current period earnings, representing a cumulative adjustment to all prior periods’ amortization, for the impact of actual gross profits and changes in the Company's projections of estimated future gross profits. Adjustments to DAC balances include: (i) annual review of assumptions that reflect the comprehensive review of the assumptions used in estimating gross profits for future periods, (ii) quarterly adjustments for current period experience (also referred to as “experience true-up” adjustments) that reflect the impact of differences between actual gross profits for a given period and the previously estimated expected gross profits for that period, and (iii) quarterly adjustments for market performance (also referred to as “experience unlocking”) that reflect the impact of changes to the Company's estimate of total gross profits to reflect actual fund performance and market conditions.

For some products, policyholders can elect to modify product benefits, features, rights or coverages by exchanging a contract for a new contract or by amendment, endorsement or rider to a contract, or by the election of a feature or coverage within a contract. These transactions are known as internal replacements. If policyholders surrender traditional life insurance policies in exchange for life insurance policies that do not have fixed and guaranteed terms, the Company immediately charges to expense the remaining unamortized DAC on the surrendered policies. For other internal replacement transactions, except those that involve the addition of a non-integrated contract feature that does not change the existing base contract, the unamortized DAC is immediately charged to expense if the terms of the new policies are not substantially similar to those of the former policies. If the new terms are substantially similar to those of the earlier policies, the DAC is retained with respect to the new policies and amortized over the expected life of the new policies. See Note 6 for additional information regarding DAC.

Deferred sales inducements represent various types of sales inducements to contractholders primarily related to fixed and variable deferred annuity contracts. The Company defers sales inducements and amortizes them over the expected life of the policy using the same methodology and assumptions used to amortize DAC. Sales inducements balances are subject to periodic recoverability testing. The Company records amortization of deferred sales inducements in “Interest credited to policyholders’ account balances.” Deferred sales inducements for applicable products are adjusted for the impact of unrealized gains or losses on investments as if these gains or losses had been realized, with corresponding credits or charges included in AOCI. There was no deferred sales inducements balance at December 31, 2018 and 2017. See Note 8 for additional information regarding sales inducements.

B-12

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Accrued investment income primarily includes accruals of interest and dividend income from investments that have been earned but not yet received.

Reinsurance recoverables include corresponding receivables associated with reinsurance arrangements with affiliates and third-party reinsurers. For additional information about these arrangements see Note 9.

Other assets consist primarily of premiums due and deferred loss on reinsurance with affiliates.

Separate account assets represent segregated funds that are invested for certain contractholders and other customers. The assets consist primarily of equity securities, fixed maturities, and real estate related investments and are reported at fair value. The assets of each account are legally segregated and are not subject to claims that arise out of any other business of the Company. Investment risks associated with market value changes are borne by the contractholders, except to the extent of minimum guarantees made by the Company with respect to certain accounts. The investment income and realized investment gains or losses from separate accounts generally accrue to the contractholders and are not included in the Company’s results of operations. Mortality, policy administration and surrender charges assessed against the accounts are included in “Policy charges and fee income”. Asset administration fees charged to the accounts are included in “Asset administration fees”. See Note 8 for additional information regarding separate account arrangements with contractual guarantees. See also “Separate account liabilities” below.

Short-term investments primarily consist of highly liquid debt instruments with a maturity of twelve months or less and greater than three months when purchased. These investments are generally carried at fair value or amortized cost that approximates fair value and include certain money market investments, funds managed similar to regulated money market funds, short-term debt securities issued by government sponsored entities and other highly liquid debt instruments.

LIABILITIES

Policyholders’ account balances liability represents the contract value that has accrued to the benefit of the policyholder as of the balance sheet date. This liability is primarily associated with the accumulated account deposits, plus interest credited, less policyholder withdrawals and other charges assessed against the account balance, as applicable. These policyholders’ account balances also include provision for benefits under non-life contingent payout annuities and certain unearned revenues. See Note 7 for additional information regarding policyholders’ account balances.

Future policy benefits liability includes liabilities related to certain long-duration life and annuity contracts, which are discussed more fully in Note 8. These liabilities represent reserves for the guaranteed minimum death and optional living benefit features on our variable annuity products and no lapse guarantees for our variable and universal life products. The optional living benefits are primarily accounted for as embedded derivatives, with fair values calculated as the present value of future expected benefit payments to customers less the present value of assessed rider fees attributable to the embedded derivative feature. For additional information regarding the valuation of these optional living benefit features, see Note 5.

The Company’s liability for future policy benefits also includes reserves based on the present value of estimated future payments to or on behalf of policyholders related to contracts that have fixed and guaranteed terms, where the timing and amount of payment depends on policyholder mortality and maintenance expenses less the present value of future net premiums. Expected mortality is generally based on Company experience, industry data and/or other factors. Interest rate assumptions are based on factors such as market conditions and expected investment returns. Although mortality, morbidity and interest rate assumptions are “locked-in” upon the issuance of new insurance or annuity business with fixed and guaranteed terms, significant changes in experience or assumptions may require the Company to provide for expected future losses on a product by establishing premium deficiency reserves. Premium deficiency reserves are established, if necessary, when the liability for future policy benefits plus the present value of expected future gross premiums are determined to be insufficient to provide for expected future policy benefits and expenses. Premium deficiency reserves do not include a provision for the risk of adverse deviation. Any adjustments to future policy benefit reserves related to net unrealized gains on securities classified as available-for-sale are included in AOCI. See Note 7 for additional information regarding future policy benefits.

B-13

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Cash collateral for loaned securities represent liabilities to return cash proceeds from security lending transactions. Securities lending transactions are used primarily to earn spread income, or to borrow funds. As part of securities lending transactions, the Company transfers U.S. and foreign debt and equity securities, as well as U.S. government and government agency securities, and receives cash as collateral. Cash proceeds from securities lending transactions are used to earn spread income, and are typically invested in cash equivalents, short-term investments or fixed maturities. Securities lending transactions are treated as financing arrangements and are recorded at the amount of cash received. The Company obtains collateral in an amount equal to 102% and 105% of the fair value of the domestic and foreign securities, respectively. The Company monitors the market value of the securities loaned on a daily basis with additional collateral obtained as necessary. Substantially all of the Company’s securities lending transactions are with large brokerage firms and large banks. Income and expenses associated with securities lending transactions used to earn spread income are reported as “Net investment income”; however, for securities lending transactions used for funding purposes the associated rebate is reported as interest expense (included in “General, administrative and other expenses”).

Securities sold under agreements to repurchase represent liabilities associated with securities repurchase agreements which are used primarily to earn spread income, to borrow funds, or to facilitate trading activity. As part of securities repurchase agreements, the Company transfers U.S. government and government agency securities to a third-party, and receives cash as collateral. For securities repurchase agreements used to earn spread income, the cash received is typically invested in cash equivalents, short-term investments or fixed maturities. Receivables associated with securities purchased under agreements to resell are generally reflected as cash equivalents (see also "Cash and cash equivalents" above). As part of securities resale agreements, the Company invests cash and receives as collateral U.S. government securities or other debt securities.

Securities repurchase and resale agreements that satisfy certain criteria are treated as secured borrowing or secured lending arrangements. These agreements are carried at the amounts at which the securities will be subsequently resold or reacquired, as specified in the respective transactions. For securities purchased under agreements to resell, the Company’s policy is to take possession or control of the securities either directly or through a third-party custodian. These securities are valued daily and additional securities or cash collateral is received, or returned, when appropriate to protect against credit exposure. Securities to be resold are the same, or substantially the same, as the securities received. The majority of these transactions are with large brokerage firms and large banks. For securities sold under agreements to repurchase, the market value of the securities to be repurchased is monitored, and additional collateral is obtained where appropriate, to protect against credit exposure. The Company obtains collateral in an amount at least equal to 95% of the fair value of the securities sold. Securities to be repurchased are the same, or substantially the same, as those sold. The majority of these transactions are with highly rated money market funds. Income and expenses related to these transactions executed within the insurance companies used to earn spread income are reported as “Net investment income”; however, for transactions used for funding purposes, the associated borrowing cost is reported as interest expense (included in “General, administrative and other expenses”). Income and expenses related to these transactions executed within the Company’s derivative operations are reported in “Other income (loss)”.

Income taxes liability primarily represents the net deferred tax liability and the Company’s estimated taxes payable for the current year and open audit years.

The Company is a member of the federal income tax return of Prudential Financial and primarily files separate company state and local tax returns. Pursuant to the tax allocation arrangement with Prudential Financial, total federal income tax expense is determined on a separate company basis. Members with losses record tax benefits to the extent such losses are recognized in the consolidated federal tax provision.

Items required by tax regulations to be included in the tax return may differ from the items reflected in the financial statements. As a result, the effective tax rate reflected in the financial statements may be different than the actual rate applied on the tax return. Some of these differences are permanent such as expenses that are not deductible in the Company’s tax return, and some differences are temporary, reversing over time, such as valuation of insurance reserves. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that can be used as a tax deduction or credit in future years for which the Company has already recorded the tax benefit in the Company’s Statements of Operations. Deferred tax liabilities generally represent tax expense recognized in the Company’s financial statements for which payment has been deferred, or expenditures for which the Company has already taken a deduction in the Company’s tax returns but have not yet been recognized in the Company’s financial statements.

B-14

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Deferred income taxes are recognized, based on enacted rates, when assets and liabilities have different values for financial statement and tax reporting purposes. The application of U.S. GAAP requires the Company to evaluate the recoverability of the Company’s deferred tax assets and establish a valuation allowance if necessary to reduce the Company’s deferred tax assets to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. See Note 8 for a discussion of factors considered when evaluating the need for a valuation allowance.

In December of 2017, SEC staff issued "SAB 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act" ("SAB 118"), which allowed registrants to record provisional amounts during a ‘measurement period’ not to extend beyond one year. Under the relief provided by SAB 118, a company could recognize provisional amounts when it did not have the necessary information available, prepared or analyzed in reasonable detail to complete its accounting for the change in tax law. See Note 10 for a discussion of provisional amounts related to the U.S. Tax Cuts and Jobs Act of 2017 ("Tax Act of 2017") recorded in 2017 and adjustments to provisional amounts recorded in 2018.

U.S. GAAP prescribes a comprehensive model for how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that a company has taken or expects to take on tax returns. The application of this guidance is a two-step process. First, the Company determines whether it is more likely than not, based on the technical merits, that the tax position will be sustained upon examination. If a tax position does not meet the more likely than not recognition threshold, the benefit of that position is not recognized in the financial statements. The second step is measurement. The Company measures the tax position as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate resolution with a taxing authority that has full knowledge of all relevant information. This measurement considers the amounts and probabilities of the outcomes that could be realized upon ultimate settlement using the facts, circumstances, and information available at the reporting date.

The Company’s liability for income taxes includes a liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by the Internal Revenue Service (“IRS”) or other taxing jurisdictions. Audit periods remain open for review until the statute of limitations has passed. Generally, for tax years which produce net operating losses, capital losses or tax credit carryforwards (“tax attributes”), the statute of limitations does not close, to the extent of these tax attributes, until the expiration of the statute of limitations for the tax year in which they are fully utilized. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the liability for income taxes. The Company classifies all interest and penalties related to tax uncertainties as income tax expense. See Note 10 for additional information regarding income taxes.

Other liabilities consist primarily of accrued expenses, reinsurance payables and technical overdrafts.

Separate account liabilities primarily represent the contractholders’ account balance in separate account assets and to a lesser extent borrowings of the separate account, and will be equal and offsetting to total separate account assets. See also “Separate account assets” above.

Short-term and long-term debt liabilities are primarily carried at an amount equal to unpaid principal balance, net of unamortized discount or premium and debt issue costs. Original-issue discount or premium and debt-issue costs are recognized as a component of interest expense over the period the debt is expected to be outstanding, using the interest method of amortization. Interest expense is generally presented within “General, administrative and other expenses” in the Company’s Statements of Operations. Short-term debt is debt coming due in the next twelve months, including that portion of debt otherwise classified as long-term. The short-term debt caption may exclude short-term debt items for which the Company has the intent and ability to refinance on a long-term basis in the near term. See Note 13 for additional information regarding short-term and long-term debt.

Commitments and contingent liabilities are accrued if it is probable that a liability has been incurred and an amount is reasonably estimable. Management evaluates whether there are incremental legal or other costs directly associated with the ultimate resolution of the matter that are reasonably estimable and, if so, they are included in the accrual. These accruals are generally reported in “Other liabilities”.

B-15

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

REVENUES AND BENEFITS AND EXPENSES

Insurance Revenue and Expense Recognition

Premiums from individual life products, other than universal and variable life contracts, are recognized when due. When premiums are due over a significantly shorter period than the period over which benefits are provided, any gross premium in excess of the net premium (i.e., the portion of the gross premium required to provide for all expected future benefits and expenses) is generally deferred and recognized into revenue in a constant relationship to insurance in force. Benefits are recorded as an expense when they are incurred. A liability for future policy benefits is recorded when premiums are recognized using the net level premium valuation methodology.

Premiums from single premium immediate annuities with life contingencies are recognized when due. When premiums are due over a significantly shorter period than the period over which benefits are provided, any gross premium in excess of the net premium is generally deferred and recognized into revenue based on expected future benefit payments. Benefits are recorded as an expense when they are incurred. A liability for future policy benefits is recorded when premiums are recognized using the net level premium methodology.

Certain individual annuity contracts provide the contractholder a guarantee that the benefit received upon death or annuitization will be no less than a minimum prescribed amount. These benefits are accounted for as insurance contracts. The Company also provides contracts with certain living benefits which are considered embedded derivatives. See Note 8 for additional information regarding these contracts.

Amounts received as payment for universal or variable individual life contracts, deferred fixed or variable annuities and other contracts without life contingencies are reported as deposits to “Policyholders’ account balances” and/or “Separate account liabilities.” Revenues from these contracts are reflected in “Policy charges and fee income” consisting primarily of fees assessed during the period against the policyholders’ account balances for mortality and other benefit charges, policy administration charges and surrender charges. In addition to fees, the Company earns investment income from the investment of deposits in the Company’s general account portfolio. Fees assessed that represent compensation to the Company for services to be provided in future periods and certain other fees are generally deferred and amortized into revenue over the life of the related contracts in proportion to estimated gross profits. Benefits and expenses for these products include claims in excess of related account balances, expenses of contract administration, interest credited to policyholders’ account balances and amortization of DAC and DSI.

Asset administration fees primarily include asset administration fee income received on contractholders’ account balances invested in The Prudential Series Funds, which are a portfolio of mutual fund investments related to the Company’s separate account products. Also, the Company receives fee income calculated on contractholder separate account balances invested in the Advanced Series Trust ("AST") (see Note 13). In addition, the Company receives fees from contractholders’ account balances invested in funds managed by companies other than affiliates of Prudential Insurance. Asset administration fees are recognized as income when earned.

Other income includes realized and unrealized gains or losses from investments reported as “Fixed maturities, trading, at fair value”, “Equity securities, at fair value”, and “Other invested assets” that are measured at fair value.

OTHER ACCOUNTING POLICIES

Derivative Financial Instruments

Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices, values of securities or commodities, credit spreads, market volatility, expected returns, and liquidity. Values can also be affected by changes in estimates and assumptions, including those related to counterparty behavior and non-performance risk ("NPR") used in valuation models. Derivative financial instruments generally used by the Company include swaps, futures, forwards and options and may be exchange-traded or contracted in the over-the-counter (“OTC”) market. Derivative positions are carried at fair value, generally by obtaining quoted market prices or through the use of valuation models.

Derivatives are used to manage the interest rate and currency characteristics of assets or liabilities. Additionally, derivatives may be used to seek to reduce exposure to interest rate, credit, foreign currency and equity risks associated with assets held or expected to be purchased or sold, and liabilities incurred or expected to be incurred. As discussed in detail below and in Note 4, all realized and unrealized changes in fair value of derivatives are recorded in current earnings, with the exception of the effective portion of cash flow hedges. Cash flows from derivatives are reported in the operating, investing or financing activities sections in the Statements of Cash Flows based on the nature and purpose of the derivative.

B-16

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Derivatives are recorded either as assets, within "Other invested assets", or as liabilities, within “Payables to parent and affiliates”, except for embedded derivatives which are recorded with the associated host contract. The Company nets the fair value of all derivative financial instruments with counterparties for which a master netting arrangement has been executed.

The Company designates derivatives as either (1) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (“cash flow” hedge); or (2) a derivative that does not qualify for hedge accounting.

To qualify for hedge accounting treatment, a derivative must be highly effective in mitigating the designated risk of the hedged item. Effectiveness of the hedge is formally assessed at inception and throughout the life of the hedging relationship. Even if a derivative qualifies for hedge accounting treatment, there may be an element of ineffectiveness of the hedge. Under such circumstances, the ineffective portion is recorded in “Realized investment gains (losses), net”.

The Company formally documents at inception all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking various hedge transactions. This process includes linking all derivatives designated as cash flow hedges to specific assets and liabilities on the balance sheet or to specific firm commitments or forecasted transactions.

When a derivative is designated as a cash flow hedge and is determined to be highly effective, changes in its fair value are recorded in AOCI until earnings are affected by the variability of cash flows being hedged (e.g., when periodic settlements on a variable-rate asset or liability are recorded in earnings). At that time, the related portion of deferred gains or losses on the derivative instrument is reclassified and reported in the Statements of Operations line item associated with the hedged item.

If it is determined that a derivative no longer qualifies as an effective cash flow hedge or management removes the hedge designation, the derivative will continue to be carried on the balance sheet at its fair value, with changes in fair value recognized currently in “Realized investment gains (losses), net”. The component of AOCI related to discontinued cash flow hedges is reclassified to the Statements of Operations line associated with the hedged cash flows consistent with the earnings impact of the original hedged cash flows.

When hedge accounting is discontinued because the hedged item no longer meets the definition of a firm commitment, or because it is probable that the forecasted transaction will not occur by the end of the specified time period, the derivative will continue to be carried on the balance sheet at its fair value, with changes in fair value recognized currently in “Realized investment gains (losses), net”. Any asset or liability that was recorded pursuant to recognition of the firm commitment is removed from the balance sheet and recognized currently in “Realized investment gains (losses), net”. Gains and losses that were in AOCI pursuant to the hedge of a forecasted transaction are recognized immediately in “Realized investment gains (losses), net”.

If a derivative does not qualify for hedge accounting, all changes in its fair value, including net receipts and payments, are included in “Realized investment gains (losses), net” without considering changes in the fair value of the economically associated assets or liabilities.

The Company is a party to financial instruments that contain derivative instruments that are “embedded” in the financial instruments. At inception, the Company assesses whether the economic characteristics of the embedded instrument are clearly and closely related to the economic characteristics of the remaining component of the financial instrument (i.e., the host contract) and whether a separate instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. When it is determined that (1) the embedded instrument possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and (2) a separate instrument with the same terms would qualify as a derivative instrument, the embedded instrument qualifies as an embedded derivative that is separated from the host contract, carried at fair value, and changes in its fair value are included in “Realized investment gains (losses), net.” For certain financial instruments that contain an embedded derivative that otherwise would need to be bifurcated and reported at fair value, the Company may elect to carry the entire instrument at fair value and report it within “Fixed maturities, trading, at fair value" or "Equity securities, at fair value".

The Company sells variable annuity contracts that include optional living benefit features that may be treated from an accounting perspective as embedded derivatives. The Company has reinsurance agreements to transfer the risks related to certain of these benefit features to affiliates, Pruco Re and Pruco Life through March 31, 2016. Effective April 1, 2016, the Company recaptured the risks related to its variable annuity living benefit guarantees that were previously reinsured to Pruco Re and Pruco Life. In addition, the Company reinsured the variable annuity base contracts, along with the living benefit guarantees, to Prudential Insurance under a coinsurance and modified coinsurance agreement. See Note 1 for additional information. The embedded derivatives related to the living benefit features and the related reinsurance agreements are carried at fair value and included in “Future policy benefits” and “Reinsurance recoverables”. Changes in the fair value are determined using valuation models as described in Note 5 and are recorded in “Realized investment gains (losses), net”.

B-17

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Accounting for Certain Reinsurance Contracts in the Individual Life business

In 2017, the Company recognized a pre-tax charge of $2 million, reflecting a change in estimate of reinsurance cash flows associated with universal life products as well as a change in method of reflecting these cash flows in the financial statements. Under the previous method of accounting, with the exception of recoveries pertaining to no lapse guarantees, reinsurance cash flows (e.g., premiums and recoveries) were generally recognized as they occurred. Under the new method, the expected reinsurance cash flows are recognized more ratably over the life of the underlying reinsured policies. In conjunction with this change, the way in which reinsurance is reflected in estimated gross profits used for the amortization of unearned revenue reserves and DAC was also revised. The change represents a change in accounting estimate effected by a change in accounting principle and was included within the Company’s annual reviews and update of assumptions and other refinements. The change in accounting estimate reflected insights gained from revised cash flow modeling enabled by a systems conversion, which prompted the change to a preferable accounting method. This new methodology is viewed as preferable as the Company believes it better reflects the economics of reinsurance transactions by aligning the results of reinsurance activity more closely to the underlying direct insurance activity and by better reflecting the profit pattern of this business for purposes of the amortization of the balances noted above.

The impacts of the pre-tax charge of $2 million in the second quarter of 2017 were as follows:



	Impact of Change in Accounting for Certain Reinsurance Contracts(1)
	(in millions)
Decrease in Policy charges and fee income	$	(10	)
Decrease in Policyholders' benefits	10
Increase in Amortization of deferred policy acquisition costs	(2		)
Pre-tax charge to income	$	(2	)


(1)	The corresponding impacts to the Consolidated Statement of Financial Position were a $13 million increase in "Other liabilities", a $9 million increase in "Reinsurance recoverables", a $4 million decrease in "Policyholders’ account balances" and a $2 million decrease in "Deferred policy acquisition costs".

RECENT ACCOUNTING PRONOUNCEMENTS

Changes to U.S. GAAP are established by the Financial Accounting Standards Board ("FASB") in the form of Accounting Standards Updates ("ASU") to the FASB Accounting Standards Codification. The Company considers the applicability and impact of all ASU. ASU listed below include those that have been adopted during the current fiscal year and/or those that have been issued but not yet adopted as of the date of this filing. ASU not listed below were assessed and determined to be either not applicable or not material.

Adoption of ASU 2016-01

Effective January 1, 2018, the Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities using a modified retrospective method. Adoption of this ASU impacted the Company’s accounting and presentation related to equity investments. The most significant impact is that the changes in fair value of equity securities previously classified as “available for sale” are to be reported in net income within “Other income” in the Statements of Operations. Prior to this, the changes in fair value on equity securities classified as “available for sale” were reported in AOCI.

The impacts of this ASU on the Company’s Financial Statements can be categorized as follows: (1) Changes to the presentation within the Statements of Financial Position; (2) Cumulative-effect Adjustment Upon Adoption; and (3) Changes to Accounting Policies. Each of these components is described below.

B-18

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

(1) Changes to the presentation within the Statements of Financial Position

Because of the fundamental accounting changes as described in section "(3) Changes to Accounting Policies" below, the Company determined that changes to the presentation of certain balances in the investment section of the Company’s Statements of Financial Position were also necessary to maintain clarity and logical presentation. The table below illustrates these changes by presenting the balances as previously reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 and the reclassifications that were made, along with a footnote explanation of each reclassification.



	December 31, 2017
	As previously reported		Reclassifications									As currently reported
Consolidated Statements of Financial Position Line Items			(1)			(2)			(3)
	(in thousands)
Fixed maturities, available-for-sale, at fair value	$	1,261,237										$	1,261,237
*Fixed maturities, trading, at fair value	0					6,643						6,643
Equity securities, available-for-sale, at fair value	3,414		(3,414		)							0
*Equity securities, at fair value	0		3,414			7,428						10,842
Trading account assets, at fair value	14,071					(14,071		)				0
Policy loans	193,244											193,244
Short-term investments	0											0
Commercial mortgage and other loans	121,796											121,796
Other long-term investments	46,803								(46,803		)	0
*Other invested assets	0								46,803			46,803
Total investments	$	1,640,565	$	0		$	0		$	0		$	1,640,565

* - New line item effective January 1, 2018.

Strikethrough - Eliminated line item effective January 1, 2018.


(1)	Retitled “Equity securities, available-for-sale, at fair value” to “Equity securities, at fair value” as equity securities can no longer be described as available-for-sale.


(2)	Eliminated the line item “Trading account assets, at fair value” and reclassified each component to another line item.


(3)	Retitled “Other long-term investments” to “Other invested assets”.

(2) Cumulative-effect Adjustment Upon Adoption

The provisions of ASU 2016-01 require that the Company apply the amendments through a cumulative-effect adjustment to the Statements of Financial Position as of the beginning of the fiscal year of adoption. The following table illustrates the impact on the Company’s Statement of Financial Position as a result of recording this cumulative-effect adjustment on January 1, 2018.



Summary of ASU 2016-01 Transition Impacts on the Statement
of Financial Position upon Adoption on January 1, 2018

(in thousands)
	Increase / (Decrease)
Other invested assets	$	250
Total assets	$	250
Income taxes payable	$	53
Total liabilities	53
Accumulated other comprehensive income (loss)	(175		)
Retained earnings	372
Total equity	197
Total liabilities and equity	$	250

B-19

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

(3) Changes to Accounting Policies

The narrative description of our significant accounting policies at the beginning of this Note reflects our policies as of December 31, 2018, including policies associated with the adoption of ASU 2016-01.

Other ASU adopted during the twelve months ended December 31, 2018



Standard	Description	Effective date and method of adoption	Effect on the financial statements or other significant matters
ASU 2014-09, Revenue from Contracts with Customers (Topic 606)	The ASU is based on the core principle that revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The standard also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, and assets recognized from the costs to obtain or fulfill a contract with a customer. Revenue recognition for insurance contracts and financial instruments is explicitly scoped out of the standard.	January 1, 2018 using the modified retrospective method which included a cumulative-effect adjustment on the balance sheet as of the beginning of the fiscal year of adoption.	Adoption of the ASU did not have an impact on the Company’s Financial Statements and Notes to the Financial Statements.
ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a Consensus of the Emerging Issues Task Force)	This ASU addresses diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The standard provides clarity on the treatment of eight specifically defined types of cash inflows and outflows.	January 1, 2018 using the retrospective method (with early adoption permitted provided that all amendments are adopted in the same period).	Adoption of the ASU did not have a significant impact on the Company’s Financial Statements and Notes to the Financial Statements.
ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash	In November 2016, the FASB issued this ASU to address diversity in practice from entities classifying and presenting transfers between cash and restricted cash as operating, investing, or financing activities, or as a combination of those activities in the Statement of Cash Flows. The ASU requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the Statement of Cash Flows. As a result, transfers between such categories will no longer be presented in the Statement of Cash Flows.	January 1, 2018 using the retrospective method (with early adoption permitted).	Adoption of the ASU did not have a significant impact on the Company’s Financial Statements and Notes to the Financial Statements.

B-20

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (Loss)	In February 2018, this ASU was issued following the enactment of the Tax Act of 2017. This ASU allows an entity to elect a reclassification from AOCI to retained earnings for stranded effects resulting from the Tax Act of 2017.	January 1, 2019 with early adoption permitted. The ASU should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act of 2017 is recognized.	The Company early adopted the ASU effective January 1, 2018 and elected to apply the ASU in the period of adoption subsequent to recording the adoption impacts of ASU 2016-01 as described above. As a result, the Company reclassified stranded effects resulting from the Tax Act of 2017 by increasing AOCI and decreasing retained earnings, each by $5.9 million. Stranded effects unrelated to the Tax Act of 2017 are generally released from AOCI when an entire portfolio of the type of item related to the stranded effect is liquidated, sold or extinguished (i.e., portfolio approach).

ASU issued but not yet adopted as of December 31, 2018 — ASU 2018-12

ASU 2018-12, Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts, was issued by the FASB on August 15, 2018 and is expected to have a significant impact on the Company’s Financial Statements and Notes to the Financial Statements. The ASU is effective January 1, 2021 (with early adoption permitted), and will impact, at least to some extent, the accounting and disclosure requirements for all long-duration insurance and investment contracts issued by the Company. Outlined below are four key areas of change, although there are other changes not noted below. In addition to the impacts to the balance sheet upon adoption, the Company also expects an impact to how earnings emerge thereafter.

B-21

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

B-22

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



Market Risk Benefits	Requires an entity to measure all market risk benefits (e.g., living benefit and death benefit guarantees associated with variable annuities) at fair value with changes in value attributable to changes in an entity’s NPR to be recognized in OCI.	An entity will apply a retrospective transition method which will include a cumulative-effect adjustment on the balance sheet as of the earliest period presented.	Upon adoption, the Company expects an impact to retained earnings for the difference between the fair value and carrying value of benefits not currently measured at fair value (e.g., Guaranteed Minimum Death Benefits ("GMDB") on variable annuities) and an impact from reclassifying the cumulative effect of changes in NPR from retained earnings to AOCI. The magnitude of such adjustments is currently being assessed.

Other ASU issued but not yet adopted as of December 31, 2018

B-23

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



Standard	Description	Effective date and method of adoption	Effect on the financial statements or other significant matters
ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20) Premium Amortization on Purchased Callable Debt Securities	This ASU requires certain premiums on callable debt securities to be amortized to the earliest call date.	January 1, 2019 using the modified retrospective method (with early adoption permitted) which will include a cumulative-effect adjustment on the balance sheet as of the beginning of the fiscal year of adoption.	The Company does not expect the adoption of the ASU to have a significant impact on the Company’s Financial Statements and Notes to the Financial Statements.
ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities	This ASU makes targeted changes to the existing hedge accounting model to better portray the economics of an entity’s risk management activities and to simplify the use of hedge accounting.	January 1, 2019 using the modified retrospective method (with early adoption permitted) which will include a cumulative-effect adjustment on the balance sheet as of the beginning of the fiscal year of adoption.	The Company does not expect the adoption of the ASU to have a significant impact on the Company’s Financial Statements and Notes to the Financial Statements.

B-24

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

3. INVESTMENTS

Fixed Maturity Securities

The following tables set forth the composition of fixed maturity securities (excluding investments classified as trading), as of the dates indicated:



	December 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		OTTI in AOCI(3)
	(in thousands)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	15,388	$	940	$	0	$	16,328	$	0
Obligations of U.S. states and their political subdivisions	121,031		1,830		555		122,306		0
Foreign government bonds	68,720		96		3,522		65,294		0
U.S. corporate public securities	486,872		8,798		14,945		480,725		0
U.S. corporate private securities	231,953		1,935		7,522		226,366		0
Foreign corporate public securities	49,684		476		1,945		48,215		0
Foreign corporate private securities	149,611		736		5,584		144,763		0
Asset-backed securities(1)	22,352		1,040		41		23,351		(40		)
Commercial mortgage-backed securities	147,464		915		3,173		145,206		0
Residential mortgage-backed securities(2)	4,817		460		7		5,270		(66		)
Total fixed maturities, available-for-sale	$	1,297,892	$	17,226	$	37,294	$	1,277,824	$	(106	)


(1)	Includes credit-tranched securities collateralized by loan obligations, sub-prime mortgages, auto loans, education loans and other asset types.


(2)	Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.


(3)	Represents the amount of unrealized losses remaining in AOCI, from the impairment measurement date. Amount excludes $0.2 million of net unrealized gains on impaired available-for-sale securities relating to changes in the value of such securities subsequent to the impairment measurement date.



	December 31, 2017(4)
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		OTTI in AOCI(3)
	(in thousands)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	17,831	$	1,465	$	0	$	19,296	$	0
Obligations of U.S. states and their political subdivisions	121,208		6,660		0		127,868		0
Foreign government bonds	29,489		377		161		29,705		0
U.S. corporate public securities	464,726		34,100		1,304		497,522		(45		)
U.S. corporate private securities	235,957		7,063		930		242,090		0
Foreign corporate public securities	36,790		1,448		557		37,681		0
Foreign corporate private securities	143,608		6,991		891		149,708		0
Asset-backed securities(1)	26,539		1,275		0		27,814		(51		)
Commercial mortgage-backed securities	118,818		1,883		1,174		119,527		0
Residential mortgage-backed securities(2)	9,200		826		0		10,026		(85		)
Total fixed maturities, available-for-sale(4)	$	1,204,166	$	62,088	$	5,017	$	1,261,237	$	(181	)


(1)	Includes credit-tranched securities collateralized by loan obligations, sub-prime mortgages, auto loans, credit cards, education loans and other asset types.


(2)	Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.


(3)	Represents the amount of unrealized losses remaining in AOCI, from the impairment measurement date. Amount excludes $0.3 million of net unrealized gains on impaired available-for-sale securities relating to changes in the value of such securities subsequent to the impairment measurement date.

B-25

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)


(4)	Prior period amounts have been reclassified to conform to current period presentation.

The following tables set forth the fair value and gross unrealized losses aggregated by investment category and length of time that individual fixed maturity securities had been in a continuous unrealized loss position, as of the dates indicated:



	December 31, 2018
	Less Than Twelve Months				Twelve Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in thousands)
Fixed maturities, available-for-sale:
Obligations of U.S. states and their political subdivisions	$	36,191	$	356	$	7,585	$	199	$	43,776	$	555
Foreign government bonds	28,009		1,002		30,924		2,520		58,933		3,522
U.S. corporate public securities	182,958		7,696		124,396		7,249		307,354		14,945
U.S. corporate private securities	57,562		4,549		106,828		2,973		164,390		7,522
Foreign corporate public securities	20,062		695		16,791		1,250		36,853		1,945
Foreign corporate private securities	97,538		4,321		14,107		1,263		111,645		5,584
Asset-backed securities	7,762		41		0		0		7,762		41
Commercial mortgage-backed securities	26,453		163		61,338		3,010		87,791		3,173
Residential mortgage-backed securities	535		4		243		3		778		7
Total fixed maturities, available-for-sale	$	457,070	$	18,827	$	362,212	$	18,467	$	819,282	$	37,294



	December 31, 2017(1)
	Less Than Twelve Months				Twelve Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in thousands)
Fixed maturities, available-for-sale:
Obligations of U.S. states and their political subdivisions	$	0	$	0	$	0	$	0	$	0	$	0
Foreign government bonds	3,354		42		6,210		119		9,564		161
U.S. corporate public securities	12,254		93		46,718		1,211		58,972		1,304
U.S. corporate private securities	42,607		608		14,034		322		56,641		930
Foreign corporate public securities	5,565		27		7,369		530		12,934		557
Foreign corporate private securities	13,639		180		11,333		711		24,972		891
Asset-backed securities	0		0		0		0		0		0
Commercial mortgage-backed securities	12,774		56		44,627		1,118		57,401		1,174
Residential mortgage-backed securities	0		0		0		0		0		0
Total fixed maturities, available-for-sale	$	90,193	$	1,006	$	130,291	$	4,011	$	220,484	$	5,017


(1)	Prior period amounts have been reclassified to conform to current period presentation.

B-26

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

As of December 31, 2018 and 2017, the gross unrealized losses on fixed maturity securities were composed of $31.0 million and $4.2 million, respectively, related to “1” highest quality or “2” high quality securities based on the National Association of Insurance Commissioners (“NAIC”) or equivalent rating and $6.3 million and $0.8 million, respectively, related to other than high or highest quality securities based on NAIC or equivalent rating. As of December 31, 2018, the $18.5 million of gross unrealized losses of twelve months or more were concentrated in commercial mortgage-backed securities and in the Company's corporate securities within the finance, utility and consumer non-cyclical sectors. As of December 31, 2017, the $4.0 million of gross unrealized losses of twelve months or more were concentrated in commercial mortgage-backed securities and in the Company's corporate securities within the finance and technology sectors. In accordance with its policy described in Note 2, the Company concluded that an adjustment to earnings for OTTI for these fixed maturity securities was not warranted at either December 31, 2018 or 2017. These conclusions were based on a detailed analysis of the underlying credit and cash flows on each security. Gross unrealized losses are primarily attributable to general credit spread widening, increases in interest rates and foreign currency exchange rate movements. As of December 31, 2018, the Company did not intend to sell these securities, and it was not more likely than not that the Company would be required to sell these securities before the anticipated recovery of the remaining amortized cost basis.

The following table sets forth the amortized cost and fair value of fixed maturities by contractual maturities, as of the date indicated:



	December 31, 2018
	Amortized Cost		Fair Value
	(in thousands)
Fixed maturities, available-for-sale:
Due in one year or less	$	19,983	$	20,157
Due after one year through five years	158,450		153,748
Due after five years through ten years	292,180		283,399
Due after ten years	652,646		646,693
Asset-backed securities	22,352		23,351
Commercial mortgage-backed securities	147,464		145,206
Residential mortgage-backed securities	4,817		5,270
Total fixed maturities, available-for-sale	$	1,297,892	$	1,277,824

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Asset-backed, commercial mortgage-backed and residential mortgage-backed securities are shown separately in the table above, as they do not have a single maturity date.

B-27

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The following table sets forth the sources of fixed maturity proceeds and related investment gains (losses), as well as losses on impairments of both fixed maturities, for the periods indicated:



	Years Ended December 31,
	2018			2017			2016
	(in thousands)
Fixed maturities, available-for-sale:
Proceeds from sales(1)	$	3,530		$	103,740		$	189,999
Proceeds from maturities/prepayments	70,152			87,544			81,157
Gross investment gains from sales and maturities	172			88			(235		)
Gross investment losses from sales and maturities	(219		)	(989		)	(1,135		)
OTTI recognized in earnings(2)	(125		)	(80		)	0


(1)	Includes $0.0 million, $0.0 million and $0.0 million of non-cash related proceeds due to the timing of trade settlements for the years ended December 31, 2018, 2017 and 2016, respectively.


(2)	Excludes the portion of OTTI amounts remaining in OCI representing any difference between the fair value of the impaired debt security and the net present value of its projected future cash flows at the time of the impairment.

The following table sets forth a rollforward of pre-tax amounts remaining in OCI related to fixed maturity securities with credit loss impairments recognized in earnings, for the periods indicated:



	Years Ended December 31,
	2018			2017
	(in thousands)
Credit loss impairments:
Balance, beginning of period	$	561		$	562
New credit loss impairments	0			0
Additional credit loss impairments on securities previously impaired	0			0
Increases due to the passage of time on previously recorded credit losses	30			38
Reductions for securities which matured, paid down, prepaid or were sold during the period	(412		)	(37		)
Reductions for securities impaired to fair value during the period(1)	0			0
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected to be collected	0			(2		)
Assets transferred to parent and affiliates	0			0
Balance, end of period	$	179		$	561


(1)	Represents circumstances where the Company determined in the current period that it intends to sell the security or it is more likely than not that it will be required to sell the security before recovery of the security's amortized cost.

Equity Securities

The net change in unrealized gains (losses) from equity securities still held at period end, recorded within “Other income (loss),” was $(1.0) million during the year ended December 31, 2018. The net change in unrealized gains (losses) from equity securities, still held at period end, recorded within "Other comprehensive income (loss)," was $0.2 million and $1.2 million during the years ended December 31, 2017 and 2016, respectively.

B-28

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Commercial Mortgage and Other Loans

The following table sets forth the composition of “Commercial mortgage and other loans,” as of the dates indicated:



	December 31, 2018					December 31, 2017
	Amount (in thousands)			% of Total		Amount (in thousands)			% of Total
Commercial mortgage and agricultural property loans by property type:
Apartments/Multi-Family	$	41,775		35.2	%	$	44,405		36.4	%
Hospitality	9,988			8.4		10,263			8.4
Industrial	12,264			10.3		10,924			9.0
Office	16,930			14.3		17,738			14.5
Other	19,024			16.0		19,154			15.7
Retail	13,838			11.6		14,180			11.6
Total commercial mortgage loans	113,819			95.8		116,664			95.6
Agricultural property loans	4,968			4.2		5,312			4.4
Total commercial mortgage and agricultural property loans by property type	118,787			100.0	%	121,976			100.0	%
Allowance for credit losses	(151		)			(180		)
Total commercial mortgage and other loans	$	118,636				$	121,796

As of December 31, 2018, the commercial mortgage and agricultural property loans were secured by properties geographically dispersed throughout the United States (with the largest concentrations in Illinois (17%), New York (14%) and Texas (10%)) and included loans secured by properties in Europe (8%).

B-29

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The following table sets forth the activity in the allowance for credit losses for commercial mortgage and other loans, as of the dates indicated:



	Commercial Mortgage Loans			Agricultural Property Loans			Total
	(in thousands)
Balance at December 31, 2015	$	425		$	3		$	428
Addition to (release of) allowance for credit losses	(218		)	(1		)	(219		)
Charge-offs, net of recoveries	0			0			0
Balance at December 31, 2016	$	207		$	2		$	209
Addition to (release of) allowance for credit losses	(28		)	(1		)	(29		)
Charge-offs, net of recoveries	0			0			0
Balance at December 31, 2017	$	179		$	1		$	180
Addition to (release of) allowance for credit losses	(29		)	0			(29		)
Charge-offs, net of recoveries	0			0			0
Balance at December 31, 2018	$	150		$	1		$	151

The following tables set forth the allowance for credit losses and the recorded investment in commercial mortgage and other loans, as of the dates indicated:



	December 31, 2018
	Commercial Mortgage Loans		Agricultural Property Loans		Total
	(in thousands)
Allowance for credit losses:
Individually evaluated for impairment	$	0	$	0	$	0
Collectively evaluated for impairment	150		1		151
Total ending balance(1)	$	150	$	1	$	151
Recorded investment(2):
Individually evaluated for impairment	$	0	$	0	$	0
Collectively evaluated for impairment	113,819		4,968		118,787
Total ending balance(1)	$	113,819	$	4,968	$	118,787


(1)	As of December 31, 2018, there were no loans acquired with deteriorated credit quality.


(2)	Recorded investment reflects the carrying value gross of related allowance.



	December 31, 2017
	Commercial Mortgage Loans		Agricultural Property Loans		Total
	(in thousands)
Allowance for credit losses:
Individually evaluated for impairment	$	0	$	0	$	0
Collectively evaluated for impairment	179		1		180
Total ending balance(1)	$	179	$	1	$	180
Recorded investment(2):
Individually evaluated for impairment	$	0	$	0	$	0
Collectively evaluated for impairment	116,664		5,312		121,976
Total ending balance(1)	$	116,664	$	5,312	$	121,976


(1)	As of December 31, 2017, there were no loans acquired with deteriorated credit quality.


(2)	Recorded investment reflects the carrying value gross of related allowance.

B-30

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The following tables set forth certain key credit quality indicators for commercial mortgage and agricultural property loans based upon the recorded investment gross of allowance for credit losses, as of the dates indicated:



	December 31, 2018
	Debt Service Coverage Ratio
	> 1.2X		1.0X to <1.2X		< 1.0X		Total
	(in thousands)
Loan-to-Value Ratio:
0%-59.99%	$	88,427	$	1,210	$	0	$	89,637
60%-69.99%	19,975		5,513		0		25,488
70%-79.99%	2,102		1,560		0		3,662
80% or greater	0		0		0		0
Total commercial mortgage and agricultural property loans	$	110,504	$	8,283	$	0	$	118,787



	December 31, 2017
	Debt Service Coverage Ratio
	> 1.2X		1.0X to <1.2X		< 1.0X		Total
	(in thousands)
Loan-to-Value Ratio:
0%-59.99%	$	83,304	$	0	$	0	$	83,304
60%-69.99%	27,727		3,155		2,009		32,891
70%-79.99%	0		5,781		0		5,781
80% or greater	0		0		0		0
Total commercial mortgage and agricultural property loans	$	111,031	$	8,936	$	2,009	$	121,976

The following tables set forth an aging of past due commercial mortgage and other loans based upon the recorded investment gross of allowance for credit losses, as well as the amount of commercial mortgage and other loans on non-accrual status, as of the dates indicated:



	December 31, 2018
	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due(1)		Total Loans		Non-Accrual Status(2)
	(in thousands)
Commercial mortgage loans	$	113,819	$	0	$	0	$	0	$	113,819	$	0
Agricultural property loans	4,968		0		0		0		4,968		0
Total	$	118,787	$	0	$	0	$	0	$	118,787	$	0


(1)	As of December 31, 2018, there were no loans in this category accruing interest.


(2)	For additional information regarding the Company's policies for accruing interest on loans, see Note 2.

B-31

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



	December 31, 2017
	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due(1)		Total Loans		Non-Accrual Status(2)
	(in thousands)
Commercial mortgage loans	$	116,664	$	0	$	0	$	0	$	116,664	$	0
Agricultural property loans	5,312		0		0		0		5,312		0
Total	$	121,976	$	0	$	0	$	0	$	121,976	$	0


(1)	As of December 31, 2017, there were no loans in this category accruing interest.


(2)	For additional information regarding the Company's policies for accruing interest on loans, see Note 2.

For the years ended December 31, 2018 and 2017, there were no commercial mortgage or other loans acquired, other than those through direct origination. For the year ended December 31, 2018, there were no commercial mortgage and other loans sold. For the year ended December 31, 2017, there were $42 million of commercial mortgage and other loans sold.

Other Invested Assets

The following table sets forth the composition of “Other invested assets,” as of the dates indicated:



	December 31,
	2018		2017
	(in thousands)
Company's investment in separate accounts	$	3,008	$	2,726
LPs/LLCs:
Equity method:
Private equity	15,081		12,350
Hedge funds	28,266		28,167
Real estate-related	1,385		1,112
Subtotal equity method	44,732		41,629
Fair value:
Private equity	920		1,141
Hedge funds	105		121
Real estate-related	1,856		1,186
Subtotal fair value(1)	2,881		2,448
Total LPs/LLCs	47,613		44,077
Derivative instruments	7,792		0
Total other invested assets(2)	$	58,413	$	46,803


(1)	As of December 31, 2017, $2.3 million was accounted for using the cost method.


(2)	Prior period amounts have been reclassified to conform to current period presentation. For additional information, see Note 2.

As of both December 31, 2018 and 2017, the Company had no significant equity method investments.

B-32

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Net Investment Income

The following table sets forth “Net investment income” by investment type, for the periods indicated:



	Years Ended December 31,
	2018			2017			2016
	(in thousands)
Fixed maturities, available-for-sale	$	52,235		$	48,232		$	47,671
Fixed maturities, trading	322			306			372
Equity securities, at fair value	364			363			393
Commercial mortgage and other loans	5,006			6,088			8,325
Policy loans	11,071			10,618			10,482
Short-term investments and cash equivalents	655			457			606
Other invested assets	1,869			4,224			7,698
Gross investment income	71,522			70,288			75,547
Less: investment expenses	(3,711		)	(3,637		)	(3,522		)
Net investment income(1)	$	67,811		$	66,651		$	72,025


(1)	Prior period amounts have been reclassified to conform to current period presentation.

The carrying value of non-income producing assets included less than $1 million in available-for-sale fixed maturities, as of December 31, 2018. Non-income producing assets represent investments that had not produced income for the twelve months preceding December 31, 2018.

B-33

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Realized Investment Gains (Losses), Net

The following table sets forth “Realized investment gains (losses), net” by investment type, for the periods indicated:



	Years Ended December 31,
	2018			2017			2016
	(in thousands)
Fixed maturities(1)	$	(172	)	$	(981	)	$	(1,370	)
Equity securities(2)	0			(1		)	(954		)
Commercial mortgage and other loans	29			29			219
LPs/LLCs	49			16			178
Derivatives	(9,178		)	(13,098		)	90,352
Short-term investments and cash equivalents	(1		)	(3		)	3
Realized investment gains (losses), net	$	(9,273	)	$	(14,038	)	$	88,428


(1)	Includes fixed maturity securities classified as available-for-sale and excludes fixed maturity securities classified as trading.


(2)	Effective January 1, 2018, realized gains (losses) on equity securities are recorded within "Other income (loss)."

Net Unrealized Gains (Losses) on Investments within AOCI

The following table below sets forth net unrealized gains (losses) on investments, as of the dates indicated:



	December 31,
	2018			2017			2016
	(in thousands)
Fixed maturity securities, available-for-sale—with OTTI	$	143		$	162		$	147
Fixed maturity securities, available-for-sale—all other	(20,211		)	56,909			13,183
Equity securities, available-for-sale(1)	0			270			21
Derivatives designated as cash flow hedges (2)	1,793			(5,036		)	4,973
Affiliated notes	509			682			846
Other investments	145			(288		)	(357		)
Net unrealized gains (losses) on investments	$	(17,621	)	$	52,699		$	18,813


(1)	Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded within “Other income (loss).”


(2)	For more information on cash flow hedges, see Note 4.

Repurchase Agreements and Securities Lending

In the normal course of business, the Company sells securities under agreements to repurchase and enters into securities lending transactions. As of both December 31, 2018 and 2017, the Company had no repurchase agreements.

B-34

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The following table sets forth the composition of “Cash collateral for loaned securities,” which represents the liability to return cash collateral received for the following types of securities loaned, as of the dates indicated:



	December 31, 2018						December 31, 2017
	Remaining Contractual Maturities of the Agreements						Remaining Contractual Maturities of the Agreements
	Overnight & Continuous		Up to 30 Days		Total		Overnight & Continuous		Up to 30 Days		Total
	(in thousands)
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	0	$	0	$	0	$	0	$	10,310	$	10,310
Foreign government bonds	0		0		0		4,420		0		4,420
U.S. public corporate securities	437		0		437		0		0		0
Foreign public corporate securities	2,265		0		2,265		478		0		478
Total cash collateral for loaned securities(1)	$	2,702	$	0	$	2,702	$	4,898	$	10,310	$	15,208


(1)	The Company did not have agreements with remaining contractual maturities of thirty days or greater, as of the dates indicated.

Securities Pledged, Restricted Assets and Special Deposits

The Company pledges as collateral investment securities it owns to unaffiliated parties through certain transactions, including securities lending, securities sold under agreements to repurchase, collateralized borrowings and postings of collateral with derivative counterparties. The following table sets forth the carrying value of investments pledged to third parties and the carrying amount of the associated liabilities supported by the pledged collateral, as of the dates indicated:



	December 31,
	2018		2017
	(in thousands)
Pledged collateral:
Fixed maturity securities, available-for-sale	$	2,640	$	14,616
Total securities pledged	$	2,640	$	14,616
Liabilities supported by the pledged collateral:
Cash collateral for loaned securities	$	2,702	$	15,208
Total liabilities supported by the pledged collateral	$	2,702	$	15,208

In the normal course of its business activities, the Company accepts collateral that can be sold or repledged. The primary sources of this collateral are securities purchased under agreements to resell. As of December 31, 2018 and 2017, the fair value of this collateral was $10 million and $43 million, respectively, none of which had either been sold or repledged.

As of December 31, 2018 and 2017, there were fixed maturities of $0.5 million and $0.5 million, respectively, on deposit with governmental authorities or trustees as required by certain insurance laws.

4. DERIVATIVE INSTRUMENTS

Types of Derivative Instruments and Derivative Strategies

Interest Rate Contracts

Interest rate swaps are used by the Company to reduce risks from changes in interest rates, manage interest rate exposures arising from mismatches between assets and liabilities and to hedge against changes in their values it owns or anticipates acquiring or selling.

Swaps may be attributed to specific assets or liabilities or to a portfolio of assets or liabilities. Under interest rate swaps, the Company agrees with counterparties to exchange, at specified intervals, the difference between fixed-rate and floating-rate interest amounts calculated by reference to an agreed upon notional principal amount.

B-35

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Equity Contracts

Equity options are used by the Company to manage its exposure to the equity markets which impacts the value of assets and liabilities it owns or anticipates acquiring or selling.

Equity index options are contracts which will settle in cash based on differentials in the underlying indices at the time of exercise and the strike price. The Company uses combinations of purchases and sales of equity index options to hedge the effects of adverse changes in equity indices within a predetermined range.

Foreign Exchange Contracts

Currency derivatives, including currency swaps and forwards, are used by the Company to reduce risks from changes in currency exchange rates with respect to investments denominated in foreign currencies that the Company either holds or intends to acquire or sell.

Under currency forwards, the Company agrees with counterparties to deliver a specified amount of an identified currency at a specified future date. Typically, the price is agreed upon at the time of the contract and payment for such a contract is made at the specified future date. The Company executes forward sales of the hedged currency in exchange for U.S. dollars at a specified exchange rate. The maturities of these forwards correspond with the future periods in which the non-U.S. dollar-denominated earnings are expected to be generated.

Under currency swaps, the Company agrees with counterparties to exchange, at specified intervals, the difference between one currency and another at an exchange rate and calculated by reference to an agreed principal amount. Generally, the principal amount of each currency is exchanged at the beginning and termination of the currency swap by each party.

Credit Contracts

The Company writes credit protection to gain exposure similar to investment in public fixed maturity cash instruments. With these credit derivatives the Company sells credit protection on a single name reference, or certain index reference, and in return receives a quarterly premium. This premium or credit spread generally corresponds to the difference between the yield on the referenced names (or an index’s referenced names) public fixed maturity cash instruments and swap rates, at the time the agreement is executed. If there is an event of default by the referenced name or one of the referenced names in the index, as defined by the agreement, then the Company is obligated to pay the referenced amount of the contract to the counterparty and receive in return the referenced defaulted security or similar security or (in the case of a credit default index) pay the referenced amount less the auction recovery rate.

In addition to selling credit protection, the Company purchases credit protection using credit derivatives in order to hedge specific credit exposures in the Company’s investment portfolio.

Embedded Derivatives

The Company sells certain products (for example, variable annuities), which may include guaranteed benefit features that are accounted for as embedded derivatives. Related to these derivatives, the Company has entered into reinsurance agreements (previously reinsured to Pruco Re and Pruco Life) with an affiliate, Prudential Insurance, effective April 1, 2016. See Note 1 for additional information on the reinsurance agreements.

These embedded derivatives and reinsurance agreements, also accounted for as derivatives, are carried at fair value and marked to market through “Realized investment gains (losses), net” based on the change in value of the underlying contractual guarantees, which are determined using valuation models, as described in Note 5.

B-36

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Primary Risks Managed by Derivatives

The table below provides a summary of the gross notional amount and fair value of derivative contracts by the primary underlying risks, excluding embedded derivatives and associated reinsurance recoverables. Many derivative instruments contain multiple underlying risks. The fair value amounts below represent the gross fair value of derivative contracts prior to taking into account the netting effects of master netting agreements, cash collateral, and NPR.



	December 31, 2018							December 31, 2017
			Gross Fair Value							Gross Fair Value
Primary Underlying	Notional		Assets		Liabilities			Notional		Assets		Liabilities
	(in thousands)
Derivatives Designated as Hedge Accounting Instruments:
Currency/Interest Rate
Foreign Currency Swaps	$	119,611	$	3,787	$	(2,271	)	$	110,240	$	1,320	$	(6,869	)
Total Qualifying Hedges	$	119,611	$	3,787	$	(2,271	)	$	110,240	$	1,320	$	(6,869	)
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate
Interest Rate Swaps	$	59,075	$	2,360	$	0		$	59,075	$	3,766	$	0
Credit
Credit Default Swaps	756		0		(9		)	1,594		0		(96		)
Currency/Interest Rate
Foreign Currency Swaps	16,815		2,364		(111		)	22,237		1,748		(674		)
Foreign Currency
Foreign Currency Forwards	1,460		21		0			1,888		0		(52		)
Equity
Equity Options	281,400		2,616		(749		)	152,800		8,125		(2,813		)
Total Non-Qualifying Hedges	$	359,506	$	7,361	$	(869	)	$	237,594	$	13,639	$	(3,635	)
Total Derivatives (1)	$	479,117	$	11,148	$	(3,140	)	$	347,834	$	14,959	$	(10,504	)


(1)	Excludes embedded derivatives and associated reinsurance recoverables which contain multiple underlying risks.

The fair value of the embedded derivatives, included in "Future policy benefits," was a net liability of $489 million and $472 million as of December 31, 2018 and 2017, respectively. The fair value of the related reinsurance recoverables included in "Reinsurance recoverables" was an asset of $489 million and $472 million as of December 31, 2018 and 2017, respectively. See Note 9 for additional information on these reinsurance agreements.

The fair value of the embedded derivatives, included in "Policyholders' account balances," was a net liability of $2 million and $5 million as of December 31, 2018 and December 31, 2017, respectively. There were no related reinsurance recoverables at each respective period.

B-37

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Offsetting Assets and Liabilities

The following table presents recognized derivative instruments (excluding embedded derivatives and associated reinsurance recoverables), and repurchase and reverse repurchase agreements, that are offset in the Statements of Financial Position, and/or are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in the Statements of Financial Position.



	December 31, 2018
	Gross Amounts of Recognized Financial Instruments		Gross Amounts Offset in the Statement of Financial Position			Net Amounts Presented in the Statement of Financial Position		Financial Instruments/ Collateral(1)			Net Amount
	(in thousands)
Offsetting of Financial Assets:
Derivatives(1)	$	11,148	$	(3,355	)	$	7,793	$	(7,307	)	$	486
Securities purchased under agreements to resell	10,000		0			10,000		(10,000		)	0
Total Assets	$	21,148	$	(3,355	)	$	17,793	$	(17,307	)	$	486
Offsetting of Financial Liabilities:
Derivatives(1)	$	3,140	$	(3,140	)	$	0	$	0		$	0
Securities sold under agreements to repurchase	0		0			0		0			0
Total Liabilities	$	3,140	$	(3,140	)	$	0	$	0		$	0



	December 31, 2017
	Gross Amounts of Recognized Financial Instruments		Gross Amounts Offset in the Consolidated Statement of Financial Position			Net Amounts Presented in the Consolidated Statement of Financial Position		Financial Instruments/ Collateral(1)			Net Amount
	(in thousands)
Offsetting of Financial Assets:
Derivatives(1)	$	14,959	$	(14,959	)	$	0				$	0
Securities purchased under agreements to resell	43,000		0			43,000		(43,000		)	0
Total Assets	$	57,959	$	(14,959	)	$	43,000	$	(43,000	)	$	0
Offsetting of Financial Liabilities:
Derivatives(1)	$	10,504	$	(9,941	)	$	563	$	0		$	563
Securities sold under agreements to repurchase	0		0			0		0			0
Total Liabilities	$	10,504	$	(9,941	)	$	563	$	0		$	563


(1)	Amounts exclude the excess of collateral received/pledged from/to the counterparty.

For information regarding the rights of offset associated with the derivative assets and liabilities in the table above see “Credit Risk” below and Note 13. For securities purchased under agreements to resell and securities sold under agreements to repurchase, the Company monitors the value of the securities and maintains collateral, as appropriate, to protect against credit exposure. Where the Company has entered into repurchase and resale agreements with the same counterparty, in the event of default, the Company would generally be permitted to exercise rights of offset. For additional information on the Company’s accounting policy for securities repurchase and resale agreements, see Note 2 to the Financial Statements.

B-38

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Cash Flow Hedges

The primary derivative instruments used by the Company in its cash flow hedge accounting relationships are currency swaps. These instruments are only designated for hedge accounting in instances where the appropriate criteria are met. The Company does not use futures, options, credit, equity or embedded derivatives in any of its cash flow hedge accounting relationships.

The following tables provide the financial statement classification and impact of derivatives used in qualifying and non-qualifying hedge relationships, excluding the offset of the hedged item in an effective hedge relationship.



	Year Ended December 31, 2018
	Realized Investment Gains (Losses)			Net Investment Income		Other Income		AOCI(1)
	(in thousands)
Derivatives Designated as Hedge Accounting Instruments:
Cash flow hedges
Currency/Interest Rate	$	0		$	1,360	$	638	$	6,829
Total qualifying hedges	0			1,360		638		6,829
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	(583		)	0		0		0
Currency	98			0		0		0
Currency/Interest Rate	1,377			0		13		0
Credit	(2		)	0		0		0
Equity	(3,793		)	0		0		0
Embedded Derivatives	(6,275		)	0		0		0
Total non-qualifying hedges	(9,178		)	0		13		0
Total	$	(9,178	)	$	1,360	$	651	$	6,829



	Year Ended December 31, 2017
	Realized Investment Gains (Losses)			Net Investment Income		Other Income			AOCI(1)
	(in thousands)
Derivatives Designated as Hedge Accounting Instruments:
Cash flow hedges
Currency/Interest Rate	$	0		$	814	$	(873	)	$	(10,009	)
Total cash flow hedges	0			814		(873		)	(10,009		)
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	124			0		0			0
Currency	(106		)	0		0			0
Currency/Interest Rate	(1,833		)	0		(20		)	0
Credit	(46		)	0		0			0
Equity	3,497			0		0			0
Embedded Derivatives	(14,734		)	0		0			0
Total non-qualifying hedges	(13,098		)	0		(20		)	0
Total	$	(13,098	)	$	814	$	(893	)	$	(10,009	)

B-39

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



	Year Ended December 31, 2016
	Realized Investment Gains (Losses)			Net Investment Income		Other Income		AOCI(1)
	(in thousands)
Derivatives Designated as Hedge Accounting Instruments:
Cash flow hedges
Currency/Interest Rate	$	0		$	258	$	554	$	(678	)
Total cash flow hedges	0			258		554		(678		)
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	571			0		0		0
Currency	234			0		0		0
Currency/Interest Rate	2,028			0		17		0
Credit	(535		)	0		0		0
Equity	786			0		0		0
Embedded Derivatives	87,268			0		0		0
Total non-qualifying hedges	90,352			0		17		0
Total	$	90,352		$	258	$	571	$	(678	)


(1)	Amounts deferred in AOCI.

For the years ended December 31, 2018, 2017 and 2016, the ineffective portion of derivatives accounted for using hedge accounting was de minimis to the Company’s results of operations. Also, there were no material amounts reclassified into earnings relating to instances in which the Company discontinued cash flow hedge accounting because the forecasted transaction did not occur by the anticipated date or within the additional time period permitted by the authoritative guidance for the accounting for derivatives and hedging.

Presented below is a rollforward of current period cash flow hedges in AOCI before taxes:



	(in thousands)
Balance, December 31, 2015	$	5,651
Net deferred gains (losses) on cash flow hedges from January 1 to December 31, 2016	1,534
Amount reclassified into current period earnings	(2,212		)
Balance, December 31, 2016	4,973
Net deferred gains (losses) on cash flow hedges from January 1 to December 31, 2017	(10,136		)
Amount reclassified into current period earnings	127
Balance, December 31, 2017	(5,036		)
Net deferred gains (losses) on cash flow hedges from January 1 to December 31, 2018	8,522
Amount reclassified into current period earnings	(1,693		)
Balance, December 31, 2018	$	1,793

The changes in fair value of cash flow hedges are deferred in AOCI and are included in “Net unrealized investment gains (losses)” in the Statements of Operations and Comprehensive Income (Loss); these amounts are then reclassified to earnings when the hedged item affects earnings. Using December 31, 2018 values, it is estimated that a pre-tax gain of $1.5 million will be reclassified from AOCI to earnings during the subsequent twelve months ending December 31, 2019, offset by amounts pertaining to the hedged items.

The exposures the Company is hedging with these qualifying cash flow hedges include the variability of the payment or receipt of interest or foreign currency amounts on existing financial instruments.

B-40

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Credit Derivatives

The Company has no exposure from credit derivative positions where it has written credit protection as of December 31, 2018 and 2017.

The Company has purchased credit protection using credit derivatives in order to hedge specific credit exposures in the Company’s investment portfolio. The Company has outstanding notional amounts of $1 million and $2 million reported at fair value as a liability of $0 million and $0.1 million as of December 31, 2018 and 2017, respectively.

Credit Risk

The Company is exposed to credit-related losses in the event of non-performance by counterparty to financial derivative transactions with a positive fair value. The Company manages credit risk by entering into derivative transactions with its affiliate, Prudential Global Funding LLC (“PGF”), related to its OTC derivatives. PGF, in turn, manages its credit risk by: (i) entering into derivative transactions with highly rated major international financial institutions and other creditworthy counterparties governed by master netting agreement as applicable; (ii) trading through central clearing and OTC parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review.

Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position.

5. FAIR VALUE OF ASSETS AND LIABILITIES

Fair Value Measurement – Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative fair value guidance establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows:

Level 1 - Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets or liabilities. The Company’s Level 1 assets and liabilities primarily include certain cash equivalents.

Level 2 - Fair value is based on significant inputs, other than quoted prices included in Level 1, that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets and liabilities, quoted market prices in markets that are not active for identical or similar assets or liabilities, and other market observable inputs. The Company’s Level 2 assets and liabilities include: fixed maturities (corporate public and private bonds, most government securities, certain asset-backed and mortgage-backed securities, etc.), certain equity securities (mutual funds, which do not trade in active markets because they are not publicly available), certain cash equivalents, and certain OTC derivatives.

Level 3 - Fair value is based on at least one significant unobservable input for the asset or liability. The assets and liabilities in this category may require significant judgment or estimation in determining the fair value. The Company’s Level 3 assets and liabilities primarily include: certain private fixed maturities and equity securities, certain manually priced public fixed maturities, certain highly structured OTC derivative contracts and embedded derivatives resulting from reinsurance or certain products with guaranteed benefits.

B-41

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Assets and Liabilities by Hierarchy Level – The tables below present the balances of assets and liabilities reported at fair value on a recurring basis, as of the dates indicated.



	As of December 31, 2018
	Level 1		Level 2		Level 3		Netting(1)			Total
	(in thousands)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	0	$	16,328	$	0	$	0		$	16,328
Obligations of U.S. states and their political subdivisions	0		122,306		0		0			122,306
Foreign government bonds	0		65,294		0		0			65,294
U.S. corporate public securities	0		480,725		0		0			480,725
U.S. corporate private securities	0		224,278		2,088		0			226,366
Foreign corporate public securities	0		48,215		0		0			48,215
Foreign corporate private securities	0		143,969		794		0			144,763
Asset-backed securities(2)	0		23,351		0		0			23,351
Commercial mortgage-backed securities	0		145,206		0		0			145,206
Residential mortgage-backed securities	0		5,270		0		0			5,270
Subtotal	0		1,274,942		2,882		0			1,277,824
Fixed maturities, trading	0		5,770		0		0			5,770
Equity securities	0		3,248		6,622		0			9,870
Cash equivalents	19,972		39,946		0		0			59,918
Other invested assets(3)	0		11,148		0		(3,355		)	7,793
Reinsurance recoverables	0		0		488,825		0			488,825
Receivables from parent and affiliates	0		8,824		0		0			8,824
Subtotal excluding separate account assets	19,972		1,343,878		498,329		(3,355		)	1,858,824
Separate account assets(4)(5)	0		11,648,322		0		0			11,648,322
Total assets	$	19,972	$	12,992,200	$	498,329	$	(3,355	)	$	13,507,146
Future policy benefits(6)	$	0	$	0	$	488,825	$	0		$	488,825
Policyholders' account balances	0		0		1,949		0			1,949
Payables to parent and affiliates	0		3,140		0		(3,140		)	0
Total liabilities	$	0	$	3,140	$	490,774	$	(3,140	)	$	490,774

B-42

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



	As of December 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
	(in thousands)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	0	$	19,296	$	0	$	0		$	19,296
Obligations of U.S. states and their political subdivisions	0		127,868		0		0			127,868
Foreign government bonds	0		29,705		0		0			29,705
U.S. corporate public securities	0		497,522		0		0			497,522
U.S. corporate private securities	0		228,219		13,871		0			242,090
Foreign corporate public securities	0		37,681		0		0			37,681
Foreign corporate private securities	0		149,063		645		0			149,708
Asset-backed securities(2)	0		16,239		11,575		0			27,814
Commercial mortgage-backed securities	0		119,527		0		0			119,527
Residential mortgage-backed securities	0		10,026		0		0			10,026
Subtotal	0		1,235,146		26,091		0			1,261,237
Fixed maturities, trading(7)	0		6,643		0		0			6,643
Equity securities(7)	0		3,414		7,428		0			10,842
Cash equivalents	0		0		0		0			0
Other invested assets(3)(7)	0		14,959		0		(14,959		)	0
Reinsurance recoverables	0		0		472,157		0			472,157
Receivables from parent and affiliates	0		9,377		0		0			9,377
Subtotal excluding separate account assets	0		1,269,539		505,676		(14,959		)	1,760,256
Separate account assets(4)(5)	0		12,454,118		0		0			12,454,118
Total assets	$	0	$	13,723,657	$	505,676	$	(14,959	)	$	14,214,374
Future policy benefits(6)	$	0	$	0	$	472,157	$	0		$	472,157
Policyholders' account balances	0		0		5,463		0			5,463
Payables to parent and affiliates	0		10,504		0		(9,941		)	563
Total liabilities	$	0	$	10,504	$	477,620	$	(9,941	)	$	478,183


(1)	“Netting” amounts represent cash collateral of $0.2 million and $5.0 million as of December 31, 2018 and 2017, respectively, and the impact of offsetting asset and liability positions held with the same counterparty, subject to master netting arrangements.


(2)	Includes credit tranched securities collateralized by syndicated bank loans, sub-prime mortgages, auto loans, credit cards, education loans and other asset types.


(3)	Other invested assets excluded from the fair value hierarchy include certain hedge funds, private equity funds and other funds for which fair value is measured at net asset value ("NAV") per share (or its equivalent) as a practical expedient. At December 31, 2018 and 2017, the fair values of such investments were $2.9 million and $0.7 million, respectively.

(4)

Separate account assets represent segregated funds that are invested for certain customers. Investment risks associated with market value changes are borne by the customers, except to the extent of minimum guarantees made by the Company with respect to certain accounts. Separate account liabilities are not included in the above table as they are reported at contract value and not fair value in the Company’s Statements of Financial Position.

(5)

Separate account assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate, hedge funds and a corporate owned life insurance fund, for which fair value is measured at NAV per share (or its equivalent). At December 31, 2018 and 2017, the fair value of such investments was $1,734 million and $1,791 million respectively.

(6)

As of December 31, 2018, the net embedded derivative liability position of $489 million includes $60 million of embedded derivatives in an asset position and $549 million of embedded derivatives in a liability position. As of December 31, 2017, the net embedded derivative liability position of $472 million includes $77 million of embedded derivatives in an asset position and $549 million of embedded derivatives in a liability position.


(7)	Prior period amounts have been reclassified to conform to current period presentation. See Note 2 for details.

B-43

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The methods and assumptions the Company uses to estimate the fair value of assets and liabilities measured at fair value on a recurring basis are summarized below.

Fixed Maturity Securities – The fair values of the Company’s public fixed maturity securities are generally based on prices obtained from independent pricing services. Prices for each security are generally sourced from multiple pricing vendors, and a vendor hierarchy is maintained by asset type based on historical pricing experience and vendor expertise. The Company ultimately uses the price from the pricing service highest in the vendor hierarchy based on the respective asset type. The pricing hierarchy is updated for new financial products and recent pricing experience with various vendors. Consistent with the fair value hierarchy described above, securities with validated quotes from pricing services are generally reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs. Typical inputs used by these pricing services include but are not limited to, reported trades, benchmark yields, issuer spreads, bids, offers, and/or estimated cash flow, prepayment speeds, and default rates. If the pricing information received from third-party pricing services is deemed not reflective of market activity or other inputs observable in the market, the Company may challenge the price through a formal process with the pricing service or classify the securities as Level 3. If the pricing service updates the price to be more consistent with the presented market observations, the security remains within Level 2.

Internally-developed valuations or indicative broker quotes are also used to determine fair value in circumstances where vendor pricing is not available, or where the Company ultimately concludes that pricing information received from the independent pricing services is not reflective of market activity. If the Company concludes the values from both pricing services and brokers are not reflective of market activity, it may override the information with an internally-developed valuation. As of December 31, 2018 and 2017, overrides on a net basis were not material. Pricing service overrides, internally-developed valuations and indicative broker quotes are generally included in Level 3 in the fair value hierarchy.

The Company conducts several specific price monitoring activities. Daily analyses identify price changes over predetermined thresholds defined at the financial instrument level. Various pricing integrity reports are reviewed on a daily and monthly basis to determine if pricing is reflective of market activity or if it would warrant any adjustments. Other procedures performed include, but are not limited to, reviews of third-party pricing services methodologies, reviews of pricing trends, and back testing.

The fair values of private fixed maturities, which are originated by internal private asset managers, are primarily determined using discounted cash flow models. These models primarily use observable inputs that include Treasury or similar base rates plus estimated credit spreads to value each security. The credit spreads are obtained through a survey of private market intermediaries who are active in both primary and secondary transactions, and consider, among other factors, the credit quality and the reduced liquidity associated with private placements. Internal adjustments are made to reflect variation in observed sector spreads. Since most private placements are valued using standard market observable inputs and inputs derived from, or corroborated by, market observable data including, but not limited to observed prices and spreads for similar publicly or privately traded issues, they have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model may incorporate significant unobservable inputs, which reflect the Company’s own assumptions about the inputs that market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the price of a security, a Level 3 classification is made.

Equity Securities – Equity securities consist principally of investments in common and preferred stock of publicly traded companies, privately traded securities, as well as mutual fund shares. The fair values of most publicly traded equity securities are based on quoted market prices in active markets for identical assets and are classified within Level 1 in the fair value hierarchy. Estimated fair values for most privately traded equity securities are determined using discounted cash flow, earnings multiple and other valuation models that require a substantial level of judgment around inputs and therefore are classified within Level 3. The fair values of mutual fund shares that transact regularly (but do not trade in active markets because they are not publicly available) are based on transaction prices of identical fund shares and are classified within Level 2 in the fair value hierarchy.

Derivative Instruments – Derivatives are recorded at fair value either as assets within “Other invested assets”, or as liabilities within “Payables to parent and affiliates”, except for embedded derivatives which are recorded with the associated host contract. The fair values of derivative contracts can be affected by changes in interest rates, foreign exchange rates, credit spreads, market volatility, expected returns, NPR, liquidity and other factors.

The Company's exchange-traded futures and options include treasury and equity futures. Exchange-traded futures and options are valued using quoted prices in active markets and are classified within Level 1 in the fair value hierarchy.

B-44

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The majority of the Company’s derivative positions are traded in the OTC derivative market and are classified within Level 2 in the fair value hierarchy. OTC derivatives classified within Level 2 are valued using models that utilize actively quoted or observable market input values from external market data providers, third-party pricing vendors and/or recent trading activity. The Company’s policy is to use mid-market pricing in determining its best estimate of fair value. The fair values of most OTC derivatives, including interest rate and cross-currency swaps, currency forward contracts and single name credit default swaps are determined using discounted cash flow models. The fair values of European style option contracts are determined using Black-Scholes option pricing models. These models’ key inputs include the contractual terms of the respective contract, along with significant observable inputs, including interest rates, currency rates, credit spreads, equity prices, index dividend yields, NPR, volatility and other factors.

The Company’s cleared interest rate swaps and credit derivatives linked to an index are valued using models that utilize actively quoted or observable market inputs, including Overnight Indexed Swap discount rates, obtained from external market data providers, third-party pricing vendors and/or recent trading activity. These derivatives are classified as Level 2 in the fair value hierarchy.

Cash Equivalents and Short-Term Investments – Cash equivalents and short-term investments include money market instruments and other highly liquid debt instruments. Certain money market instruments are valued using unadjusted quoted prices in active markets that are accessible for identical assets and are primarily classified as Level 1. The remaining instruments in this category are generally fair valued based on market observable inputs, and these investments have primarily been classified within Level 2.

Separate Account Assets – Separate account assets include fixed maturity securities, treasuries, equity securities, real estate, mutual funds, and commercial mortgage loans for which values are determined consistent with similar instruments described above under “Fixed Maturity Securities” and “Equity Securities”.

Receivables from Parent and Affiliates – Receivables from parent and affiliates carried at fair value include affiliated bonds within the Company’s legal entity where fair value is determined consistent with similar securities described above under “Fixed Maturity Securities” managed by affiliated asset managers.

Reinsurance Recoverables – Reinsurance recoverables carried at fair value include the reinsurance of the Company’s living benefit guarantees on certain variable annuity contracts. These guarantees are accounted for as embedded derivatives and are recorded in “Reinsurance recoverables” or “Other liabilities” when fair value is in an asset or liability position, respectively. The methods and assumptions used to estimate the fair value are consistent with those described below in “Future policy benefits”. The reinsurance agreements covering these guarantees are derivatives with fair value determined in the same manner as the living benefit guarantee.

Future Policy Benefits – The liability for future policy benefits is related to guarantees primarily associated with the living benefit features of certain variable annuity contracts, including guaranteed minimum accumulation benefits ("GMAB"), guaranteed withdrawal benefits ("GMWB") and guaranteed minimum income and withdrawal benefits ("GMIWB"), accounted for as embedded derivatives. The fair values of these liabilities are calculated as the present value of future expected benefit payments to customers less the present value of future expected rider fees attributable to the embedded derivative feature. This methodology could result in either a liability or contra-liability balance, given changing capital market conditions and various actuarial assumptions. Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management's judgment.

The significant inputs to the valuation models for these embedded derivatives include capital market assumptions, such as interest rate levels and volatility assumptions, the Company’s market-perceived NPR, as well as actuarially determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates and mortality rates. Since many of these assumptions are unobservable and are considered to be significant inputs to the liability valuation, the liability included in future policy benefits has been reflected within Level 3 in the fair value hierarchy.

Capital market inputs and actual policyholders’ account values are updated each quarter based on capital market conditions as of the end of the quarter, including interest rates, equity markets and volatility. In the risk neutral valuation, the initial swap curve drives the total return used to grow the policyholders’ account values. The Company’s discount rate assumption is based on the London Inter-Bank Offered Rate ("LIBOR") swap curve adjusted for an additional spread relative to LIBOR to reflect NPR.

Actuarial assumptions, including contractholder behavior and mortality, are reviewed at least annually, and updated based upon emerging experience, future expectations and other data, including any observable market data. These assumptions are generally updated annually unless a material change that the Company feels is indicative of a long-term trend is observed in an interim period.

B-45

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Policyholders' Account Balances – The liability for policyholders' account balances is related to certain embedded derivative instruments associated with certain policyholders' account balances. The fair values are determined consistent with similar derivative instruments described under "Derivative Instruments".

Quantitative Information Regarding Internally-Priced Level 3 Assets and Liabilities – The tables below present quantitative information on significant internally-priced Level 3 assets and liabilities.



	As of December 31, 2018
	Fair Value		Valuation Techniques	Unobservable Inputs	Minimum		Maximum		Weighted Average		Impact of Increase in Input on Fair Value(1)
	(in thousands)
Assets:
Corporate securities(2)	$	2,882	Discounted cash flow	Discount rate	7.00	%	16.33	%	9.93	%	Decrease
Reinsurance recoverables	$	488,825	Fair values are determined using the same unobservable inputs as future policy benefits.
Liabilities:
Future policy benefits(3)	$	488,825	Discounted cash flow	Lapse rate(4)	1	%	13	%			Decrease
				Spread over LIBOR(5)	0.36	%	1.60	%			Decrease
				Utilization rate(6)	50	%	97	%			Increase
				Withdrawal rate	See table footnote (7) below.
				Mortality rate(8)	0	%	15	%			Decrease
				Equity volatility curve	18	%	22	%			Increase

	As of December 31, 2017
	Fair Value		Valuation Techniques	Unobservable Inputs	Minimum		Maximum		Weighted Average		Impact of Increase in Input on Fair Value(1)
	(in thousands)
Assets:
Corporate securities(2)	$	14,516	Discounted cash flow	Discount rate	5.06	%	22.23	%	7.53	%	Decrease
Reinsurance recoverables	$	472,157	Fair values are determined using the same unobservable inputs as future policy benefits.
Liabilities:
Future policy benefits(3)	$	472,157	Discounted cash flow	Lapse rate(4)	1	%	12	%			Decrease
				Spread over LIBOR(5)	0.12	%	1.10	%			Decrease
				Utilization rate(6)	52	%	97	%			Increase
				Withdrawal rate	See table footnote (7) below.
				Mortality rate(8)	0	%	14	%			Decrease
				Equity volatility curve	13	%	24	%			Increase


(1)	Conversely, the impact of a decrease in input would have the opposite impact on fair value as that presented in the table.


(2)	Includes assets classified as fixed maturities available-for-sale.

B-46

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

(3)

Future policy benefits primarily represent general account liabilities for the living benefit features of the Company’s variable annuity contracts which are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than weighted average, is a more meaningful representation of the unobservable inputs used in the valuation.


(4)	Lapse rates are adjusted at the contract level based on the in-the-moneyness of the living benefit and reflect other factors, such as the applicability of any surrender charges. Lapse rates are reduced when contracts are more in-the-money. Lapse rates are also generally assumed to be lower for the period where surrender charges apply.

(5)

The spread over the LIBOR swap curve represents the premium added to the proxy for the risk-free rate (LIBOR) to reflect our estimates of rates that a market participant would use to value the living benefit contracts in both the accumulation and payout phases. This spread includes an estimate of NPR, which is the risk that the obligation will not be fulfilled by the Company. NPR is primarily estimated by utilizing the credit spreads associated with issuing funding agreements, adjusted for any illiquidity risk premium. In order to reflect the financial strength ratings of the Company, credit spreads associated with funding agreements, as opposed to credit spread associated with debt, are utilized in developing this estimate because both funding agreements and living benefit contracts are insurance liabilities and are therefore senior to debt.

(6)

The utilization rate assumption estimates the percentage of contracts that will utilize the benefit during the contract duration and begin lifetime withdrawals at various time intervals from contract inception. The remaining contractholders are assumed to either begin lifetime withdrawals immediately or never utilize the benefit. Utilization assumptions may vary by product type, tax status and age. The impact of changes in these assumptions is highly dependent on the product type, the age of the contractholder at the time of the sale, and the timing of the first lifetime income withdrawal. Range reflects the utilization rate for the vast majority of business with living benefits.

(7)

The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. These assumptions vary based on the age of the contractholder, the tax status of the contract and the duration since the contractholder began lifetime withdrawals. As of December 31, 2018 and 2017, the minimum withdrawal rate assumption is 78% and the maximum withdrawal assumption rate may be greater than 100%. The fair value of the liability will generally increase the closer the withdrawal rate is to 100% and decrease as the withdrawal rate moves further away from 100%.

(8)

Range reflects the mortality rate for the vast majority of business with living benefits, with policyholders ranging from 50 to 90 years old. While the majority of living benefits have a minimum age requirement, certain benefits do not have an age restriction. This results in contractholders for certain benefits with mortality rates approaching 0%. Based on historical experience, the Company applies a set of age and duration specific mortality rate adjustments compared to standard industry tables. A mortality improvement assumption is also incorporated into the overall mortality table.

Interrelationships Between Unobservable Inputs – In addition to the sensitivities of fair value measurements to changes in each unobservable input in isolation, as reflected in the table above, interrelationships between these inputs may also exist, such that a change in one unobservable input may give rise to a change in another, or multiple, inputs. Examples of such interrelationships for significant internally-priced Level 3 assets and liabilities are as follows:

Corporate Securities – The rate used to discount future cash flows reflects current risk-free rates plus credit and liquidity spread requirements that market participants would use to value an asset. The discount rate may be influenced by many factors, including market cycles, expectations of default, collateral, term, and asset complexity. Each of these factors can influence discount rates, either in isolation, or in response to other factors.

Future Policy Benefits – The Company expects efficient benefit utilization and withdrawal rates to generally be correlated with lapse rates. However, behavior is generally highly dependent on the facts and circumstances surrounding the individual contractholder, such as their liquidity needs or tax situation, which could drive lapse behavior independent of other contractholder behavior assumptions. To the extent more efficient contractholder behavior results in greater in-the-moneyness at the contract level, lapse rates may decline for those contracts. Similarly, to the extent that increases in equity volatility are correlated with overall declines in the capital markets, lapse rates may decline as contracts become more in-the-money.

Changes in Level 3 Assets and Liabilities – The following tables describe changes in fair values of Level 3 assets and liabilities as of the dates indicated, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods. When a determination is made to classify assets and liabilities within Level 3, the determination is based on significance of the unobservable inputs in the overall fair value measurement. All transfers are based on changes in the observability of the valuation inputs, including the availability of pricing service information that the Company can validate. Transfers into Level 3 are generally the result of unobservable inputs utilized within valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company can validate. During the second quarter of 2018, $5 million of investments in collateralized loan obligations (“CLOs”) reported as “Asset-backed securities” were transferred from Level 3 to Level 2 as market activity, liquidity and overall observability of valuation inputs of CLOs have increased.

B-47

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



	Year Ended December 31, 2018
	Fair Value, beginning of period			Total realized and unrealized gains (losses)(1)			Purchases		Sales			Issuances			Settlements			Other		Transfers into Level 3		Transfers out of Level 3			Fair Value, end of period			Unrealized gains (losses) for assets still held(2)
	(in thousands)
Fixed maturities, available-for-sale:
Corporate securities(3)	$	14,516		$	(2,881	)	$	555	$	(45	)	$	0		$	(9,263	)	$	0	$	0	$	0		$	2,882		$	0
Structured securities(4)	11,575			(28		)	9,797		(196		)	0			(2,693		)	0		196		(18,651		)	0			0
Other assets:
Equity securities	7,428			(806		)	0		0			0			0			0		0		0			6,622			(806		)
Reinsurance recoverables	472,157			(70,180		)	86,848		0			0			0			0		0		0			488,825			(54,376		)
Receivables from parent and affiliates	0			(18		)	0		0			0			0			0		6,047		(6,029		)	0			0
Liabilities:
Future policy benefits	(472,157		)	70,180			0		0			(86,848		)	0			0		0		0			(488,825		)	54,376
Policyholders' account balances	(5,463		)	3,567			0		0			0			(53		)	0		0		0			(1,949		)	3,567

B-48

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



	Year Ended December 31, 2018
	Total realized and unrealized gains (losses)											Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net(1)			Other income (loss)			Included in other comprehensive income (loss)			Net investment income		Realized investment gains (losses), net			Other income (loss)
	(in thousands)
Fixed maturities, available-for-sale	$	160		$	0		$	(3,222	)	$	153	$	0		$	0
Other assets:
Equity securities	0			(806		)	0			0		0			(806		)
Reinsurance recoverables	(70,180		)	0			0			0		(54,376		)	0
Receivables from parent and affiliates	0			0			(18		)	0		0			0
Liabilities:
Future policy benefits	70,180			0			0			0		54,376			0
Policyholders' account balances	3,567			0			0			0		3,567			0



	Year Ended December 31, 2017(6)
	Fair Value, beginning of period			Total realized and unrealized gains (losses)(1)			Purchases		Sales			Issuances			Settlements			Other			Transfers into Level 3		Transfers out of Level 3			Fair Value, end of period			Unrealized gains (losses) for assets still held(2)
	(in thousands)
Fixed maturities, available-for-sale:
Corporate securities(3)	$	15,489		$	202		$	1,483	$	(767	)	$	0		$	(202	)	$	(10	)	$	521	$	(2,200	)	$	14,516		$	(62	)
Structured securities(4)	2,328			49			5,543		0			0			(9,010		)	0			16,657		(3,992		)	11,575			0
Other assets:
Equity securities(5)	6,721			696			0		0			0			0			11			0		0			7,428			696
Reinsurance recoverables	434,713			(44,680		)	82,124		0			0			0			0			0		0			472,157			(31,829		)
Receivables from parent and affiliates	5,993			0			0		0			0			0			0			0		(5,993		)	0			0
Liabilities:
Future policy benefits	(434,713		)	44,680			0		0			(82,124		)	0			0			0		0			(472,157		)	31,829
Policyholders' account balances	(2,298		)	(3,421		)	0		0			0			256			0			0		0			(5,463		)	(3,421		)

B-49

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)



	Year Ended December 31, 2017(6)
	Total realized and unrealized gains (losses)									Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net(1)			Other income (loss)		Included in other comprehensive income (loss)		Net investment income		Realized investment gains (losses), net			Other income (loss)
	(in thousands)
Fixed maturities, available-for-sale	$	5		$	0	$	81	$	165	$	(62	)	$	0
Other assets:
Equity securities(5)	0			696		0		0		0			696
Reinsurance recoverables	(44,680		)	0		0		0		(31,829		)	0
Receivables from parent and affiliates	0			0		0		0		0			0
Liabilities:
Future policy benefits	44,680			0		0		0		31,829			0
Policyholders' account balances	(3,421		)	0		0		0		(3,421		)	0

The following tables summarize the portion of changes in fair values of Level 3 assets and liabilities included in earnings and OCI for the year ended December 31, 2016, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held as of December 31, 2016.



	Year Ended December 31, 2016(6)
	Total realized and unrealized gains (losses)										Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net(1)			Other income (loss)			Included in other comprehensive income (loss)		Net investment income		Realized investment gains (losses), net			Other income (loss)
	(in thousands)
Fixed maturities, available-for-sale	$	38		$	0		$	321	$	27	$	0		$	0
Other assets:
Equity securities(5)	0			(503		)	0		0		0			(176		)
Reinsurance recoverables	7,541			0			0		0		723,728			0
Receivables from parent and affiliates	(130		)	0			105		0		0			0
Liabilities:
Future policy benefits	88,947			0			0		0		80,807			0
Policyholders' account balances	(890		)	0			0		0		(890		)	0


(1)	Realized investment gains (losses) on future policy benefits and reinsurance recoverables primarily represent the change in the fair value of the Company's living benefit guarantees on certain of its variable annuity contracts.


(2)	Unrealized gains or losses related to assets still held at the end of the period do not include amortization or accretion of premiums and discounts.


(3)	Includes U.S. corporate public, U.S. corporate private, foreign corporate public and foreign corporate private securities. Prior period amounts were aggregated to conform to current period presentation.


(4)	Includes asset-backed, commercial mortgage-backed and residential mortgage-backed securities. Prior period amounts were aggregated to conform to current period presentation.


(5)	Prior period amounts have been reclassified to conform to current period presentation. See Note 2 for details.


(6)	Prior period amounts have been updated to conform to current period presentation.

B-50

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Fair Value of Financial Instruments

The table below presents the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value. The financial instruments presented below are reported at carrying value on the Company’s Statements of Financial Position. In some cases, as described below, the carrying amount equals or approximates fair value.



	December 31, 2018(1)
	Fair Value								Carrying Amount(2)
	Level 1		Level 2		Level 3		Total		Total
	(in thousands)
Assets:
Commercial mortgage and other loans	$	0	$	0	$	119,659	$	119,659	$	118,636
Policy loans	0		0		206,448		206,448		206,448
Cash and cash equivalents	523		10,000		0		10,523		10,523
Accrued investment income	0		17,764		0		17,764		17,764
Receivables from parent and affiliates	0		31,564		0		31,564		31,564
Other assets	0		4,193		0		4,193		4,193
Total assets	$	523	$	63,521	$	326,107	$	390,151	$	389,128
Liabilities:
Policyholders’ account balances - investment contracts	$	0	$	179,239	$	40,349	$	219,588	$	220,553
Cash collateral for loaned securities	0		2,702		0		2,702		2,702
Payables to parent and affiliates	0		20,413		0		20,413		20,413
Other liabilities	0		58,357		0		58,357		58,357
Total liabilities	$	0	$	260,711	$	40,349	$	301,060	$	302,025



	December 31, 2017(1)
	Fair Value								Carrying Amount (2)
	Level 1		Level 2		Level 3		Total		Total
	(in thousands)
Assets:
Commercial mortgage and other loans	$	0	$	0	$	125,121	$	125,121	$	121,796
Policy loans	0		0		193,244		193,244		193,244
Cash and cash equivalents	1,618		43,000		0		44,618		44,618
Accrued investment income	0		16,580		0		16,580		16,580
Receivables from parent and affiliates	0		33,674		0		33,674		33,674
Other assets	0		5,768		0		5,768		5,768
Total assets	$	1,618	$	99,022	$	318,365	$	419,005	$	415,680
Liabilities:
Policyholders’ account balances - investment contracts	$	0	$	179,246	$	41,702	$	220,948	$	221,407
Cash collateral for loaned securities	0		15,208		0		15,208		15,208
Payables to parent and affiliates	0		21,673		0		21,673		21,673
Other liabilities	0		39,561		0		39,561		39,561
Total liabilities	$	0	$	255,688	$	41,702	$	297,390	$	297,849

B-51

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

(1)

The information presented as of December 31, 2017 , excludes certain hedge funds, private equity funds and other funds that were accounted for using the cost method and for which the fair value was measured at NAV per share (or its equivalent) as a practical expedient. The fair value and the carrying value of these cost method investments were $2.3 million and $2.6 million, respectively. Due to the adoption of ASU 2016-01 effective January 1, 2018, these assets are carried at fair value at each reporting date with changes in fair value reported in “Other income.” Therefore, as of December 31, 2018 , these assets are excluded from this table but are reported in the fair value recurring measurement table.


(2)	Carrying values presented herein differ from those in the Company’s Consolidated Statements of Financial Position because certain items within the respective financial statement captions are not considered financial instruments or out of scope under authoritative guidance relating to disclosures of the fair value of financial instruments.

The fair values presented above have been determined by using available market information and by applying market valuation methodologies, as described in more detail below.

Commercial Mortgage and Other Loans

The fair value of most commercial mortgage loans is based upon the present value of the expected future cash flows discounted at the appropriate U.S. Treasury rate or foreign government bond rate (for non-U.S. dollar-denominated loans) plus an appropriate credit spread for loans of similar quality, average life, and currency. The quality ratings for these loans, a primary determinant of the credit spreads and a significant component of the pricing process, are based on an internally-developed methodology. Certain commercial mortgage loans are valued incorporating other factors, including the terms of the loans, the principal exit strategies for the loans, prevailing interest rates and credit risk.

Policy Loans

The Company's valuation technique for policy loans is to discount cash flows at the current policy loan coupon rate. Policy loans are fully collateralized by the cash surrender value of underlying insurance policies. As a result, the carrying value of the policy loans approximates the fair value.

Cash and Cash Equivalents, Accrued Investment Income, Receivables from Parent and Affiliates and Other Assets

The Company believes that due to the short-term nature of certain assets, the carrying value approximates fair value. These assets include: cash and cash equivalent instruments, accrued investment income, and other assets that meet the definition of financial instruments, including receivables, such as reinsurance recoverables, unsettled trades and accounts receivable.

Policyholders’ Account Balances - Investment Contracts

Only the portion of policyholders’ account balances related to products that are investment contracts (those without significant mortality or morbidity risk) are reflected in the table above. For fixed deferred annuities, payout annuities and other similar contracts without life contingencies, fair values are generally derived using discounted projected cash flows based on interest rates that are representative of the Company’s financial strength ratings, and hence reflect the Company’s own NPR. For those balances that can be withdrawn by the customer at any time without prior notice or penalty, the fair value is the amount estimated to be payable to the customer as of the reporting date, which is generally the carrying value.

Cash Collateral for Loaned Securities

Cash collateral for loaned securities represents the collateral received or paid in connection with loaning or borrowing securities. Due to the short-term nature of these transactions, the carrying value approximates fair value.

Other Liabilities and Payables to Parent and Affiliates

Other liabilities and payables to parent and affiliates are primarily payables, such as unsettled trades, drafts, escrow deposits and accrued expense payables. Due to the short term until settlement of most of these liabilities, the Company believes that carrying value approximates fair value.

B-52

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

6. DEFERRED POLICY ACQUISITION COSTS

The balances of and changes in DAC as of and for the years ended December 31, are as follows:



	2018			2017			2016
	(in thousands)
Balance, beginning of year	$	145,451		$	135,759		$	468,743
Capitalization of commissions, sales and issue expenses	30,742			24,599			29,954
Amortization- Impact of assumption and experience unlocking and true-ups	(6,328		)	(2,875		)	17,216
Amortization- All other	(9,644		)	(9,663		)	(64,443		)
Change in unrealized investment gains and losses	5,257			(2,369		)	(1,140		)
Other(1)	0			0			(314,571		)
Balance, end of year	$	165,478		$	145,451		$	135,759


(1)	Represents ceded DAC upon reinsurance agreement with Prudential Insurance in 2016. See Note 1 and Note 9 for additional information.

7. POLICYHOLDERS’ LIABILITIES

Future Policy Benefits

Future policy benefits at December 31 for the years indicated are as follows:



	2018		2017
	(in thousands)
Life insurance	$	1,299,165	$	1,204,698
Individual annuities and supplementary contracts	27,619		26,548
Other contract liabilities	493,308		475,938
Total future policy benefits	$	1,820,092	$	1,707,184

Life insurance liabilities include reserves for death benefits. Individual annuities and supplementary contract liabilities include reserves for life contingent immediate annuities. Other contract liabilities include unearned premiums and certain other reserves for annuities and individual life products.

Future policy benefits for individual non-participating traditional life insurance policies are generally equal to the present value of future benefit payments and related expenses, less the present value of future net premiums. Assumptions as to mortality, morbidity and persistency are based on the Company’s experience, industry data, and/or other factors, when the basis of the reserve is established. Interest rates used in the determination of the present values range from 2.3% to 7.0%.

Future policy benefits for individual annuities and supplementary contracts with life contingencies are generally equal to the present value of expected future payments. Assumptions as to mortality are based on the Company’s experience, industry data, and/or other factors when the basis of the reserve is established. The interest rates used in the determination of the present value range from 0.0% to 7.3%.

The Company’s liability for future policy benefits are primarily liabilities for guaranteed benefits related to certain long-duration life and annuity contracts. Liabilities for guaranteed benefits with embedded derivative features are primarily in "Other contract liabilities" in the above table. The remaining liabilities for guaranteed benefits are primarily reflected with the underlying contract. The interest rates used in the determination of the present values range from 3.1% to 4.4%. See Note 8 for additional information regarding liabilities for guaranteed benefits related to certain long-duration contracts.

B-53

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Policyholders’ Account Balances

Policyholders’ account balances at December 31 for the years indicated are as follows:



	2018		2017
	(in thousands)
Interest-sensitive life contracts	$	1,767,831	$	1,572,432
Individual annuities	345,790		307,720
Guaranteed interest accounts	22,088		24,173
Other	179,249		179,257
Total policyholders’ account balances	$	2,314,958	$	2,083,582

Policyholders’ account balances represent an accumulation of account deposits plus credited interest less withdrawals, expenses and mortality charges, if applicable. These policyholders’ account balances also include provisions for benefits under non-life contingent payout annuities. Interest crediting rates for interest-sensitive life contracts range from 0.9% to 4.5%. Interest crediting rates for individual annuities range from 0.0% to 4.9%. Interest crediting rates for guaranteed interest accounts range from 1% to 4.8%. Interest crediting rates range from 0.5% to 3.5% for other.

8. CERTAIN LONG-DURATION CONTRACTS WITH GUARANTEES

The Company issues variable annuity contracts through its separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contractholder. The Company also issues variable annuity contracts with general and separate account options where the Company contractually guarantees to the contractholder a return of no less than total deposits made to the contract adjusted for any partial withdrawals (“return of net deposits”). In certain of these variable annuity contracts, the Company also contractually guarantees to the contractholder a return of no less than (1) total deposits made to the contract adjusted for any partial withdrawals plus a minimum return (“minimum return”), and/or (2) the highest contract value on a specified date adjusted for any withdrawals (“contract value”). These guarantees include benefits that are payable in the event of death, annuitization or at specified dates during the accumulation period and withdrawal and income benefits payable during specified periods. The Company also issued annuity contracts with market value adjusted investment options (“MVAs”), which provide for a return of principal plus a fixed rate of return if held to maturity, or, alternatively, a “market adjusted value” if surrendered prior to maturity or if funds are reallocated to other investment options. The market value adjustment may result in a gain or loss to the Company, depending on crediting rates or an indexed rate at surrender, as applicable. The Company also issued fixed deferred annuity contracts without MVA that have a guaranteed credited rate and annuity benefit.

In addition, the Company issues certain variable life, variable universal life and universal life contracts where the Company contractually guarantees to the contractholder a death benefit even when there is insufficient value to cover monthly mortality and expense charges, whereas otherwise the contract would typically lapse (“no-lapse guarantee”). Variable life and variable universal life contracts are offered with general and separate account options.

The assets supporting the variable portion of all variable annuities are carried at fair value and reported as “Separate account assets” with an equivalent amount reported as “Separate account liabilities.” Amounts assessed against the contractholders for mortality, administration, and other services are included within revenue in “Policy charges and fee income” and changes in liabilities for minimum guarantees are generally included in “Policyholders’ benefits” or “Realized investment gains (losses), net.”

For those guarantees of benefits that are payable in the event of death, the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, contract lapses and contractholder mortality.

For guarantees of benefits that are payable at annuitization, the net amount at risk is generally defined as the present value of the minimum guaranteed annuity payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, timing of annuitization, contract lapses and contractholder mortality.

B-54

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

For guarantees of benefits that are payable at withdrawal, the net amount at risk is generally defined as the present value of the minimum guaranteed withdrawal payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. For guarantees of accumulation balances, the net amount at risk is generally defined as the guaranteed minimum accumulation balance minus the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including equity market returns, interest rates, market volatility and contractholder behavior.

The Company’s contracts with guarantees may offer more than one type of guarantee in each contract; therefore, the amounts listed may not be mutually exclusive. The liabilities related to the net amount at risk are reflected within “Future policy benefits”. As of December 31, 2018 and 2017, the Company had the following guarantees associated with these contracts, by product and guarantee type:



	December 31, 2018				December 31, 2017
	In the Event of Death(1)		At Annuitization/ Accumulation(1)(2)		In the Event of Death(1)		At Annuitization/ Accumulation(1)(2)
	(in thousands)
Annuity Contracts
Return of net deposits
Account value	$	7,954,281	N/A		$	8,434,750	N/A
Net amount at risk	$	66,895	N/A		$	2,201	N/A
Average attained age of contractholders	66 years		N/A		65 years		N/A
Minimum return or contract value
Account value	$	1,820,257	$	9,082,737	$	2,079,318	$	9,746,948
Net amount at risk	$	148,719	$	381,856	$	3,442	$	134,518
Average attained age of contractholders	68 years		66 years		67 years		65 years
Average period remaining until earliest expected annuitization	N/A		0 years		N/A		0 years


(1)	Balances are gross of reinsurance.


(2)	Includes income and withdrawal benefits.



	December 31, 2018		December 31, 2017(1)
	In the Event of Death
	(in thousands)
Variable Life, Variable Universal Life and Universal Life Contracts
Separate account value	$	768,008	$	813,094
General account value	$	943,528	$	811,784
Net amount at risk	$	18,364,626	$	17,296,789
Average attained age of contractholders	54 years		55 years


(1)	Balances are gross of reinsurance.

B-55

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Account balances of variable annuity contracts with guarantees were invested in separate account investment options as follows:



	December 31, 2018		December 31, 2017(1)
	(in thousands)
Equity funds	$	4,884,603	$	5,654,716
Bond funds	4,419,587		4,369,355
Money market funds	145,921		203,033
Total	$	9,450,111	$	10,227,104


(1)	Balances are gross of reinsurance.

In addition to the amounts invested in separate account investment options above, $324 million at December 31, 2018 and $287 million at December 31, 2017 of account balances of variable annuity contracts with guarantees, inclusive of contracts with MVA features were invested in general account investment options. For the years ended December 31, 2018, 2017 and 2016, there were no transfers of assets, other than cash, from the general account to any separate account, and accordingly no gains or losses recorded.

Liabilities for Guarantee Benefits

The table below summarizes the changes in general account liabilities for guarantees. The liabilities for GMDB, and GMIB are included in “Future policy benefits” and the related changes in the liabilities are included in “Policyholders’ benefits.” GMAB, GMWB, and GMIWB are accounted for as embedded derivatives and are recorded at fair value within “Future policy benefits.” Changes in the fair value of these derivatives, including changes in the Company’s own risk of non-performance, along with any fees attributed or payments made relating to the derivative, are recorded in “Realized investment gains (losses), net.” See Note 5 for additional information regarding the methodology used in determining the fair value of these embedded derivatives.



	GMDB						GMIB			GMWB/GMIWB/GMAB			Total
	Variable Annuity			Variable Life, Variable Universal Life & Universal Life			Variable Annuity						Total

	(in thousands)
Balance at December 31, 2015	$	10,581		$	84,176		$	1,446		$	449,072		$	545,275
Incurred guarantee benefits(1)	660			54,869			(300		)	(14,359		)	40,870
Paid guarantee benefits	(532		)	(5,399		)	(25		)	0			(5,956		)
Change in unrealized investment gains and losses	(74		)	3,673			(5		)	0			3,594
Balance at December 31, 2016	10,635			137,319			1,116			434,713			583,783
Incurred guarantee benefits(1)	893			47,907			(570		)	37,443			85,673
Paid guarantee benefits	(154		)	(250		)	(11		)	0			(415		)
Change in unrealized investment gains and losses	161			11,265			2			0			11,428
Balance at December 31, 2017	11,535			196,241			537			472,156			680,469
Incurred guarantee benefits(1)	1,913			52,918			10			16,669			71,510
Paid guarantee benefits	(964		)	(5,636		)	0			0			(6,600		)
Change in unrealized investment gains and losses	(216		)	(18,681		)	(4		)	0			(18,901		)
Balance at December 31, 2018	$	12,268		$	224,842		$	543		$	488,825		$	726,478


(1)	Incurred guarantee benefits include the portion of assessments established as additions to reserves as well as changes in estimates affecting the reserves. Also includes changes in the fair value of features considered to be derivatives.

B-56

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The GMDB liability is determined each period end by estimating the accumulated value of a portion of the total assessments to date less the accumulated value of the guaranteed death benefits in excess of the account balance. The GMIB liability associated with variable annuities is determined each period by estimating the accumulated value of a portion of the total assessments to date less the accumulated value of the projected income benefits in excess of the account balance. The portion of assessments used is chosen such that, at issue the present value of expected death benefits or expected income benefits in excess of the projected account balance and the portion of the present value of total expected assessments over the lifetime of the contracts are equal. The Company regularly evaluates the estimates used and adjusts the GMDB and GMIB liability balances, with an associated charge or credit to earnings, if actual experience or other evidence suggests that earlier estimates should be revised.

The GMAB features provide the contractholder with a guaranteed return of initial account value or an enhanced value if applicable. The most significant of the Company’s GMAB features are the guaranteed return option features, which includes an automatic rebalancing element that reduces the Company’s exposure to these guarantees. The GMAB liability is calculated as the present value of future expected payments in excess of the account balance less the present value of future expected rider fees attributable to the embedded derivative feature.

The GMWB features provide the contractholder with access to a guaranteed remaining balance if the account value is reduced to zero through a combination of market declines and withdrawals. The guaranteed remaining balance is generally equal to the protected value under the contract, which is initially established as the greater of the account value or cumulative deposits when withdrawals commence, less cumulative withdrawals. The contractholder also has the option, after a specified time period, to reset the guaranteed remaining balance to the then-current account value, if greater. The contractholder accesses the guaranteed remaining balance through payments over time, subject to maximum annual limits. The GMWB liability is calculated as the present value of future expected payments to customers less the present value of future expected rider fees attributable to the embedded derivative feature.

The GMIWB features, taken collectively, provide a contractholder two optional methods to receive guaranteed minimum payments over time, a “withdrawal” option or an “income” option. The withdrawal option (which was available under only one of the GMIWBs and is no longer offered) guarantees that a contractholder can withdraw an amount each year until the cumulative withdrawals reach a total guaranteed balance. The income option (which varies among the Company’s GMIWBs) in general, guarantees the contractholder the ability to withdraw an amount each year for life (or for joint lives, in the case of any spousal version of the benefit) where such amount is equal to a percentage of a protected value under the benefit. The contractholder also has the potential to increase this annual amount, based on certain subsequent increases in account value that may occur. The GMIWB can be elected by the contractholder upon issuance of an appropriate deferred variable annuity contract or at any time following contract issue prior to annuitization. Certain GMIWB features include an automatic rebalancing element that reduces the Company’s exposure to these guarantees. The GMIWB liability is calculated as the present value of future expected payments to customers less the present value of future expected rider fees attributable to the embedded derivative feature.

Sales Inducements

The Company defers sales inducements and amortizes them over the anticipated life of the policy using the same methodology and assumptions used to amortize DAC. The Company has offered various types of sales inducements, including: (1) a bonus whereby the policyholder’s initial account balance is increased by an amount equal to a specified percentage of the customer’s initial deposit and (2) additional credits after a certain number of years a contract is held. Changes in DSI, reported as “Interest credited to policyholders’ account balances,” are as follows:



	Sales Inducements
	(in thousands)
Balance at December 31, 2015	$	63,043
Capitalization	100
Amortization- Impact of assumption and experience unlocking and true-ups	1,035
Amortization- All other	(13,203		)
Change in unrealized investment gains (losses)	(383		)
Other(1)	(50,592		)
Balance at December 31, 2016	0


(1)	Represents ceded DSI upon reinsurance agreement with Prudential Insurance in 2016. See Note 1 and Note 9 for additional information.

There were no deferred sales inducements balances at December 31, 2018 and 2017 because they were fully ceded.

B-57

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

9. REINSURANCE

The Company participates in reinsurance with its affiliates Prudential Arizona Reinsurance Captive Company (“PARCC”), Prudential Arizona Reinsurance Term Company (“PAR Term”), Prudential Arizona Reinsurance Universal Company (“PAR U”), Prudential Term Reinsurance Company (“Term Re”) and Dryden Arizona Reinsurance Term Company ("DART"), its parent companies, Pruco Life and Prudential Insurance, as well as third parties, and participated in reinsurance with its affiliate Pruco Re through March 31, 2016. The reinsurance agreements provide risk diversification and additional capacity for future growth, limit the maximum net loss potential, manage statutory capital, facilitate the Company's capital market hedging program, and align accounting methodology for the assets and liabilities of living benefit guarantees contained in annuities contracts. See Note 1 for additional information on the change effective April 1, 2016 related to the Variable Annuities Recapture. Life reinsurance is accomplished through various plans of reinsurance, primarily yearly renewable term and coinsurance. Reinsurance ceded arrangements do not discharge the Company as the primary insurer. Ceded balances would represent a liability of the Company in the event the reinsurers were unable to meet their obligations to the Company under the terms of the reinsurance agreements. The Company believes a material reinsurance liability resulting from such inability of reinsurers to meet their obligations is unlikely.

Reserves related to reinsured long duration contracts are accounted for using assumptions consistent with those used to account for the underlying contracts. Amounts recoverable from reinsurers for long duration reinsurance arrangements are estimated in a manner consistent with the claim liabilities and policy benefits associated with the reinsured policies. Reinsurance premiums ceded for universal life products are accounted for as a reduction of policy charges and fee income. Reinsurance premiums ceded for term insurance products are accounted for as a reduction of premiums.

Realized investment gains and losses include the impact of reinsurance agreements, particularly reinsurance agreements involving living benefit guarantees. The Company has entered into a reinsurance agreement to transfer the risk related to living benefit guarantees on variable annuities to Prudential Insurance. See Note 1 for additional information on the change effective April 1, 2016 related to the Variable Annuities Recapture. These reinsurance agreements are derivatives and have been accounted for in the same manner as embedded derivatives and the changes in the fair value of these derivatives are recognized through “Realized investment gains (losses), net”. See Note 4 for additional information related to the accounting for embedded derivatives.

Reinsurance amounts included in the Company’s Statements of Financial Position as of December 31, were as follows:



	2018			2017
	(in thousands)
Reinsurance recoverables	$	2,723,518		$	2,480,848
Policy loans	(17,297		)	(16,065		)
Deferred policy acquisition costs	(754,569		)	(708,740		)
Deferred sales inducements	(52,875		)	(58,399		)
Other assets	17,959			19,159
Other liabilities	65,225			56,232

The reinsurance recoverables by counterparty are broken out below:



	December 31, 2018		December 31, 2017
	(in thousands)
Prudential Insurance	$	924,847	$	859,122
PAR U	922,904		814,408
PARCC	480,627		485,809
PAR Term	205,972		188,756
Term Re	156,303		116,869
Pruco Life	15,013		13,671
DART	13,367		0
Unaffiliated	4,485		2,213
Total reinsurance recoverables	$	2,723,518	$	2,480,848

B-58

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Reinsurance amounts, included in the Company’s Statements of Operations and Comprehensive Income for the years ended December 31, were as follows:



	2018			2017			2016
	(in thousands)
Premiums:
Direct	$	238,622		$	231,167		$	217,375
Ceded	(225,615		)	(217,200		)	(252,050		)
Net premiums	13,007			13,967			(34,675		)
Policy charges and fee income:
Direct	361,697			409,874			273,121
Ceded(1)	(299,130		)	(365,671		)	(206,575		)
Net policy charges and fee income	62,567			44,203			66,546
Net investment income:
Direct	68,467			67,243			72,561
Ceded	(656		)	(592		)	(536		)
Net investment income	67,811			66,651			72,025
Asset administration fees:
Direct	36,214			38,743			34,847
Ceded	(30,858		)	(29,668		)	(20,489		)
Net asset administration fees	5,356			9,075			14,358
Realized investment gains (losses), net:
Direct	70,414			41,810			89,216
Ceded	(79,687		)	(55,848		)	(788		)
Realized investment gains (losses), net	(9,273		)	(14,038		)	88,428
Policyholders’ benefits (including change in reserves):
Direct	296,335			291,003			289,066
Ceded(2)	(276,506		)	(278,748		)	(287,081		)
Net policyholders’ benefits (including change in reserves)	19,829			12,255			1,985
Interest credited to policyholders’ account balances:
Direct	67,490			54,624			55,928
Ceded	(31,554		)	(21,665		)	(12,000		)
Net interest credited to policyholders’ account balances	35,936			32,959			43,928
Reinsurance expense allowances and general and administrative expenses, net of capitalization and amortization	$	(161,905	)	$	(165,870	)	$	(78,200	)


(1)	"Policy charges and fee income ceded" includes $(4) million, $(4) million and $(3) million of unaffiliated activity for the years ended December 31, 2018, 2017 and 2016, respectively.


(2)	"Policyholders' benefits (including change in reserves) ceded" includes $(4) million, $(0.2) million and $(0.8) million of unaffiliated activity for the years ended December 31, 2018, 2017 and 2016, respectively.

The gross and net amounts of life insurance face amount in force as of December 31, were as follows:



	2018			2017			2016
	(in thousands)
Direct gross life insurance face amount in force	$	140,943,939		$	136,020,588		$	129,865,065
Reinsurance ceded	(128,863,466		)	(123,974,595		)	(118,390,153		)
Net life insurance face amount in force	$	12,080,473		$	12,045,993		$	11,474,912

B-59

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Information regarding significant affiliated reinsurance agreements is described below.

Prudential Insurance

The Company has a yearly renewable term reinsurance agreement with Prudential Insurance and reinsures the majority of all mortality risks not otherwise reinsured. Effective July 1, 2017, this agreement was terminated for certain new business, primarily Universal Life business, and such business was reinsured to Pruco Life under a yearly renewable term reinsurance agreement. Effective April 1, 2016 the Company entered into a reinsurance agreement with Prudential Insurance to reinsure its variable annuity base contracts, along with the living benefit guarantees. See Note 1 for additional information related to the Variable Annuities Recapture.

PAR U

Effective July 1, 2012, the Company reinsures an amount equal to 95% of all risks associated with Universal Protector policies having no-lapse guarantees as well as certain of its universal policies, excluding those policies that are subject to principles-based reserving.

PARCC

The Company reinsures 90% of the risks under its term life insurance policies, with effective dates prior to January 1, 2010 through an automatic coinsurance agreement with PARCC.

PAR Term

The Company reinsures 95% of the risks under its term life insurance policies, with effective dates January 1, 2010 through December 31, 2013, through an automatic coinsurance agreement with PAR Term.

Term Re

The Company reinsures 95% of the risks under its term life insurance policies, with effective dates on or after January 1, 2014 through December 31, 2017, through an automatic coinsurance agreement with Term Re.

Pruco Life

Effective July 1, 2017, the Company entered into a yearly renewable term reinsurance agreement with Pruco Life for new business, primarily covering Universal Life policies. Under this agreement the majority of all mortality risk is ceded to Pruco Life. The Company also reinsures certain Corporate Owned Life Insurance (“COLI”) policies with Pruco Life. Through March 31, 2016, the Company reinsured Prudential Defined Income ("PDI") living benefit guarantees with Pruco Life. Effective April 1, 2016, the Company recaptured PDI living benefit guarantees from Pruco Life and reinsured them with Prudential Insurance. See Note 1 for additional information related to the Variable Annuities Recapture.

DART

Effective January 1, 2018, the Company entered into an automatic coinsurance agreement with DART to reinsure an amount equal to 95% of the risks associated with its term life insurance policies with effective dates on or after January 1, 2018.

Pruco Re

Through March 31, 2016, the Company entered into various automatic coinsurance agreements with Pruco Re to reinsure its living benefit guarantees sold on certain of its annuities. See Note 1 for additional information on the change effective April 1, 2016 related to the Variable Annuities Recapture.

B-60

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

10. INCOME TAXES

The following schedule discloses significant components of income tax expense (benefit) for each year presented:



	Year Ended December 31,
	2018			2017			2016
	(in thousands)
Current tax expense (benefit):
U.S. Federal	$	8,435		$	4,514		$	6,701
Total	8,435			4,514			6,701
Deferred tax expense (benefit):
U.S. Federal	(8,488		)	(10,452		)	7,534
Total	(8,488		)	(10,452		)	7,534
Total income tax expense (benefit) from operations	(53		)	(5,938		)	14,235
Income tax expense (benefit) reported in equity related to:
Other comprehensive income (loss)	(14,464		)	10,084			205
Additional paid-in capital	0			471			93
Total income tax expense (benefit)	$	(14,517	)	$	4,617		$	14,533

Reconciliation of Expected Tax at Statutory Rates to Reported Income Tax Expense (Benefit)

The differences between income taxes expected at the U.S. federal statutory income tax rate of 21% applicable for 2018 and 35% applicable for the periods prior to 2018, and reported income tax expense (benefit) are summarized as follows:



	Year Ended December 31,
	2018			2017			2016
	(in thousands)
Expected federal income tax expense	$	6,559		$	10,262		$	32,702
Non-taxable investment income	(5,171		)	(15,687		)	(14,883		)
Tax credits	(3,525		)	(2,611		)	(2,734		)
Domestic production activities deduction, net	0			(1,045		)	(949		)
Changes in tax law	(61		)	2,507			0
Settlements with taxing authorities	2,098			0			0
Other	47			636			99
Reported income tax expense (benefit)	$	(53	)	$	(5,938	)	$	14,235
Effective tax rate	(0.2		)%	(20.3		)%	15.2		%

B-61

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The effective tax rate is the ratio of “Total income tax expense (benefit)” divided by “Income (loss) from operations before income taxes.” The Company’s effective tax rate for fiscal years 2018, 2017 and 2016 was (0.2)%, (20.3)% and 15.2%, respectively. The following is a description of items that had the most significant impact on the difference between the Company’s statutory U.S. federal income tax rate of 21% applicable for 2018 and 35% applicable for the periods prior to 2018, and the Company's effective tax rate during the periods presented:

Changes in Tax Law. The following is a list of notable changes in tax law that impacted the Company’s effective tax rate for the periods presented:

Tax Act of 2017 - On December 22, 2017, the Tax Act of 2017 was enacted into U.S. law. As a result, the Company recognized a $2.5 million tax expense in “Total income tax expense (benefit)” in the Company’s Consolidated Statements of Operations for the year ended December 31, 2017. In accordance with SEC Staff Accounting Bulletin 118, in 2017 the Company recorded the effects of the Tax Act of 2017 using reasonable estimates due to the need for further analysis of the provisions within the Tax Act of 2017 and collection, preparation and analysis of relevant data necessary to complete the accounting. During 2018, the Company completed the collection, preparation and analysis of data relevant to the Tax Act of 2017, and interpreted any additional guidance issued by the IRS, U.S. Department of the Treasury, or other standard-setting organizations, and recognized a $0.1 million decrease in income tax expense for a total of $2.4 million recognized from the reduction in net deferred tax assets to reflect the reduction in the U.S. tax rate from 35% to 21%.

Non-Taxable Investment Income. The U.S. Dividends Received Deduction (“DRD”) reduces the amount of dividend income subject to U.S. tax and accounts for most of the non-taxable investment income shown in the table above. More specifically, the U.S. DRD constitutes $5 million of the total $5 million of 2018 non-taxable investment income, $15 million of the total $16 million of 2017 non-taxable investment income, and $15 million of the total $15 million of 2016 non-taxable investment income. The DRD for the current period was estimated using information from 2017, current year investment results, and current year’s equity market performance. The actual current year DRD can vary based on factors such as, but not limited to, changes in the amount of dividends received that are eligible for the DRD, changes in the amount of distributions received from fund investments, changes in the account balances of variable life and annuity contracts, and the Company’s taxable income before the DRD.

Other. This line item represents insignificant reconciling items that are individually less than 5% of the computed expected federal income tax expense (benefit) and have therefore been aggregated for purposes of this reconciliation in accordance with relevant disclosure guidance.

Schedule of Deferred Tax Assets and Deferred Tax Liabilities



	As of December 31,
	2018		2017
	(in thousands)
Deferred tax assets:
Insurance reserves	$	19,049	$	14,868
Net Unrealized gain on securities	4,077		0
Deferred policy acquisition costs	6,653		7,297
Other	440		0
Deferred tax assets	30,219		22,165
Deferred tax liabilities:
Net unrealized gains on securities	0		12,124
Investments	5,364		8,070
Other	0		17
Deferred tax liabilities	5,364		20,211
Net deferred tax asset (liability)	$	24,855	$	1,954

B-62

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

The application of U.S. GAAP requires the Company to evaluate the recoverability of deferred tax assets and establish a valuation allowance if necessary to reduce the deferred tax asset to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. In evaluating the need for a valuation allowance, the Company considers many factors, including: (1) the nature of the deferred tax assets and liabilities; (2) whether they are ordinary or capital; (3) in which tax jurisdictions they were generated and the timing of their reversal; (4) taxable income in prior carryback years as well as projected taxable earnings exclusive of reversing temporary differences and carryforwards; (5) the length of time that carryovers can be utilized in the various taxing jurisdictions; (6) any unique tax rules that would impact the utilization of the deferred tax assets; and (7) any tax planning strategies that the Company would employ to avoid a tax benefit from expiring unused. Although realization is not assured, management believes it is more likely than not that the deferred tax assets, net of valuation allowances, will be realized.

The company had no valuation allowance as of December 31, 2018, and 2017. Adjustments to the valuation allowance will be made if there is a change in management’s assessment of the amount of deferred tax asset that is realizable.

The Company’s "Income (loss) from operations before income taxes" includes income from domestic operations of $31 million, $29 million and $93 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Tax Audit and Unrecognized Tax Benefits

The Company’s liability for income taxes includes the liability for unrecognized tax benefits and interest that relate to tax years still subject to review by the IRS or other taxing authorities. The completion of review or the expiration of the Federal statute of limitations for a given audit period could result in an adjustment to the liability for income taxes.

The following table reconciles the total amount of unrecognized tax benefits at the beginning and end of the periods indicated.



	2018			2017		2016
	(in thousands)
Balance at January 1,	$	3,019		$	948	$	0
Increases in unrecognized tax benefits-prior years	0			1,237		474
(Decreases) in unrecognized tax benefits-prior years	0			0		0
Increases in unrecognized tax benefits-current year	0			834		474
(Decreases) in unrecognized tax benefits-current year	0			0		0
Settlements with taxing authorities	(3,019		)	0		0
Balance at December 31,	$	0		$	3,019	$	948
Unrecognized tax benefits that, if recognized, would favorably impact the effective rate	$	0		$	3,019	$	948

The Company does not anticipate any significant changes within the next twelve months to its total unrecognized tax benefits related to tax years for which the statute of limitations has not expired.

The Company classifies all interest and penalties related to tax uncertainties as income tax expense (benefit).

At December 31, 2018, the Company remains subject to examination in the U.S. for tax years 2015 through 2017.

The Company is participating in the IRS’s Compliance Assurance Program. Under this program, the IRS assigns an examination team to review completed transactions as they occur in order to reach agreement with the Company on how they should be reported in the relevant tax returns. If disagreements arise, accelerated resolution programs are available to resolve the disagreements in a timely manner before the tax return is filed.

B-63

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

11. EQUITY

Accumulated Other Comprehensive Income (Loss)

AOCI represents the cumulative OCI items that are reported separate from net income and detailed on the Statements of Comprehensive Income. Each of the components that comprise OCI are described in further detail in Note 2 (Foreign Currency Translation Adjustment and Net Unrealized Investment Gains (Losses)). The balance of and changes in each component of AOCI as of and for the years ended December 31, are as follows:



	Accumulated Other Comprehensive Income (Loss)
	Foreign Currency Translation Adjustment			Net Unrealized Investment Gains (Losses)(1)			Total Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance, December 31, 2015	$	(69	)	$	11,850		$	11,781
Change in OCI before reclassifications	(1		)	(1,738		)	(1,739		)
Amounts reclassified from AOCI	0			2,324			2,324
Income tax benefit (expense)	0			(205		)	(205		)
Balance, December 31, 2016	$	(70	)	$	12,231		$	12,161
Change in OCI before reclassifications	43			31,228			31,271
Amounts reclassified from AOCI	0			982			982
Income tax benefit (expense)	(15		)	(10,069		)	(10,084		)
Balance, December 31, 2017	$	(42	)	$	34,372		$	34,330
Change in OCI before reclassifications	(1,187		)	(66,171		)	(67,358		)
Amounts reclassified from AOCI	0			(1,521		)	(1,521		)
Income tax benefit (expense)	248			14,216			14,464
Cumulative effect of adoption of ASU 2016-01	0			(175		)	(175		)
Cumulative effect of adoption of ASU 2018-02	(8		)	5,901			5,893
Balance, December 31, 2018	$	(989	)	$	(13,378	)	$	(14,367	)


(1)	Includes cash flow hedges of $2 million, $(5) million and $5 million as of December 31, 2018, 2017 and 2016, respectively.

Reclassifications out of Accumulated Other Comprehensive Income (Loss)



	Year Ended December 31, 2018			Year Ended December 31, 2017			Year Ended December 31, 2016
	(in thousands)
Amounts reclassified from AOCI (1)(2):
Net unrealized investment gains (losses):
Cash flow hedges - Currency/Interest rate(3)	$	1,693		$	(127	)	$	2,212
Net unrealized investment gains (losses) on available-for-sale securities(4)	(172		)	(855		)	(4,536		)
Total net unrealized investment gains (losses)	1,521			(982		)	(2,324		)
Total reclassifications for the period	$	1,521		$	(982	)	$	(2,324	)


(1)	All amounts are shown before tax.


(2)	Positive amounts indicate gains/benefits reclassified out of AOCI. Negative amounts indicate losses/costs reclassified out of AOCI.


(3)	See Note 4 for additional information on cash flow hedges.


(4)	See table below for additional information on unrealized investment gains (losses), including the impact on deferred policy acquisition and other costs, future policy benefits and policyholders’ account balances.

B-64

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Net Unrealized Investment Gains (Losses)

Net unrealized investment gains (losses) on securities classified as available-for-sale, certain other invested assets and other assets are included in the Company’s Statements of Financial Position as a component of AOCI. Changes in these amounts include reclassification adjustments to exclude from “Other comprehensive income (loss)” those items that are included as part of “Net income” for a period that had been part of “Other comprehensive income (loss)” in earlier periods. The amounts for the periods indicated below, split between amounts related to fixed maturity securities on which an OTTI loss has been recognized, and all other net unrealized investment gains (losses), are as follows:

B-65

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Net Unrealized Investment Gains (Losses) on Fixed Maturity Securities on which an OTTI loss has been recognized



	Net Unrealized Gains (Losses) on Investments			Deferred Policy Acquisition Costs and Other Costs(1)			Future Policy Benefits, Policyholders' Account Balances and Other Liabilities(2)			Deferred Income Tax (Liability) Benefit			Accumulated Other Comprehensive Income (Loss) Related To Net Unrealized Investment Gains (Losses)
	(in thousands)
Balance, December 31, 2015	$	211		$	194		$	139		$	(191	)	$	353
Net investment gains (losses) on investments arising during the period	(13		)	0			0			5			(8		)
Reclassification adjustment for (gains) losses included in net income	(51		)	0			0			18			(33		)
Reclassification adjustment for OTTI losses excluded from net income	0			0			0			0			0
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs	0			(32		)	0			11			(21		)
Impact of net unrealized investment (gains) losses on future policy benefits, policyholder's account balances and other liabilities	0			0			(5		)	2			(3		)
Balance, December 31, 2016	$	147		$	162		$	134		$	(155	)	$	288
Net investment gains (losses) on investments arising during the period	23			0			0			(7		)	16
Reclassification adjustment for (gains) losses included in net income	(12		)	0			0			4			(8		)
Reclassification adjustment for OTTI losses excluded from net income	4			0			0			(1		)	3
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs	0			(225		)	0			80			(145		)
Impact of net unrealized investment (gains) losses on future policy benefits, policyholder's account balances and other liabilities	0			0			(25		)	9			(16		)
Balance, December 31, 2017	$	162		$	(63	)	$	109		$	(70	)	$	138
Net investment gains (losses) on investments arising during the period	3			0			0			(1		)	2
Reclassification adjustment for (gains) losses included in net income	(22		)	0			0			5			(17		)
Reclassification adjustment for OTTI losses excluded from net income	0			0			0			0			0
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs	0			9			0			(2		)	7
Impact of net unrealized investment (gains) losses on future policy benefits, policyholder's account balances and other liabilities	0			0			(67		)	14			(53		)
Balance, December 31, 2018	$	143		$	(54	)	$	42		$	(54	)	$	77


(1)	"Other costs" primarily includes reinsurance recoverables and deferred reinsurance losses.


(2)	"Other liabilities" primarily includes reinsurance payables.

B-66

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

All Other Net Unrealized Investment Gains (Losses) in AOCI



	Net Unrealized Gains (Losses) on Investments(1)			Deferred Policy Acquisition Costs and Other Costs(2)			Future Policy Benefits, Policyholders' Account Balances and Other Liabilities(3)			Deferred Income Tax (Liability) Benefit			Accumulated Other Comprehensive Income (Loss) Related To Net Unrealized Investment Gains (Losses)
	(in thousands)
Balance, December 31, 2015	$	22,795		$	(8,588	)	$	3,479		$	(6,189	)	$	11,497
Net investment gains (losses) on investments arising during the period	(1,856		)	0			0			650			(1,206		)
Reclassification adjustment for (gains) losses included in net income	(2,273		)	0			0			796			(1,477		)
Reclassification adjustment for OTTI losses excluded from net income	0			0			0			0			0
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs	0			2,180			0			(764		)	1,416
Impact of net unrealized investment (gains) losses on future policy benefits, policyholders' account balances and other liabilities	0			0			2,636			(923		)	1,713
Balance, December 31, 2016	$	18,666		$	(6,408	)	$	6,115		$	(6,430	)	$	11,943
Net investment gains (losses) on investments arising during the period	34,845			0			0			(10,920		)	23,925
Reclassification adjustment for (gains) losses included in net income	(970		)	0			0			304			(666		)
Reclassification adjustment for OTTI losses excluded from net income	(4		)	0			0			1			(3		)
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs	0			6,443			0			(2,293		)	4,150
Impact of net unrealized investment (gains) losses on future policy benefits, policyholders' account balances and other liabilities	0			0			(7,869		)	2,754			(5,115		)
Balance, December 31, 2017	$	52,537		$	35		$	(1,754	)	$	(16,584	)	$	34,234
Net investment gains (losses) on investments arising during the period	(68,532		)	0			0			14,392			(54,140		)
Reclassification adjustment for (gains) losses included in net income	(1,499		)	0			0			315			(1,184		)
Reclassification adjustment for OTTI losses excluded from net income	0			0			0			0			0
Impact of net unrealized investment (gains) losses on deferred policy acquisition costs and other costs	0			3,134			0			(658		)	2,476
Impact of net unrealized investment (gains) losses on future policy benefits, policyholders' account balances and other liabilities	0			0			(718		)	151			(567		)
Cumulative effect of adoption of ASU 2016-01	(270		)	0			0			95			(175		)
Cumulative effect of adoption of ASU 2018-02	0			0			0			5,901			5,901
Balance, December 31, 2018	$	(17,764	)	$	3,169		$	(2,472	)	$	3,612		$	(13,455	)


(1)	Includes cash flow hedges. See Note 4 for information on cash flow hedges.


(2)	"Other costs" primarily includes reinsurance recoverables and deferred reinsurance losses.


(3)	"Other liabilities" primarily includes reinsurance payables.

B-67

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

12. STATUTORY NET INCOME AND SURPLUS AND DIVIDEND RESTRICTIONS

The Company is required to prepare statutory financial statements in accordance with accounting practices prescribed or permitted by the New Jersey Department of Banking and Insurance. Statutory accounting practices primarily differ from U.S. GAAP by charging policy acquisition costs to expense as incurred, establishing future policy benefit liabilities using different actuarial assumptions and valuing investments, deferred taxes, and certain assets on a different basis.

Statutory net income of the Company amounted to $33 million, $33 million and $81 million for the years ended December 31, 2018, 2017 and 2016, respectively. Statutory surplus of the Company amounted to $234 million and $223 million at December 31, 2018 and 2017, respectively.

The Company does not utilize prescribed or permitted practices that vary materially from the statutory accounting practices prescribed by the NAIC.

The Company is subject to New Jersey law, which limits the amount of dividends that insurance companies can pay to stockholders without approval of the New Jersey Department of Banking and Insurance. The maximum dividend, which may be paid in any twelve-month period without notification or approval, is limited to the greater of 10% of statutory surplus as of December 31 of the preceding year or the net gain from operations of the preceding calendar year. Cash dividends may only be paid out of surplus derived from realized net profits. Based on these limitations, there is a capacity to pay a dividend of $32 million in 2019 without prior approval. The Company paid dividends to Pruco Life of $0 million, $100 million and $241 million in 2018, 2017 and 2016 respectively.

13. RELATED PARTY TRANSACTIONS

The Company has extensive transactions and relationships with Prudential Insurance and other affiliates. Although we seek to ensure that these transactions and relationships are fair and reasonable, it is possible that the terms of these transactions are not the same as those that would result from transactions among unrelated parties.

Expense Charges and Allocations

Many of the Company’s expenses are allocations or charges from Prudential Insurance or other affiliates. These expenses can be grouped into general and administrative expenses and agency distribution expenses.

The Company’s general and administrative expenses are charged to the Company using allocation methodologies based on business production processes. Management believes that the methodology is reasonable and reflects costs incurred by Prudential Insurance to process transactions on behalf of the Company. The Company operates under service and lease agreements whereby services of officers and employees, supplies, use of equipment and office space are provided by Prudential Insurance. The Company reviews its allocation methodology periodically which it may adjust accordingly. "General and administrative expenses" include allocations of stock compensation expenses related to a stock-based awards program and a deferred compensation program issued by Prudential Financial. The expense charged to the Company for the stock based-awards program was $0.1 million for each of the years ended December 31, 2018, 2017 and 2016. The expense charged to the Company for the deferred compensation program was $0.7 million, $1 million and $0.9 million for the years ended December 31, 2018, 2017 and 2016, respectively.

The Company is charged for its share of employee benefit expenses. These expenses include costs for funded and non-funded contributory and non-contributory defined benefit pension plans. Some of these benefits are based on final earnings and length of service while others are based on an account balance, which takes into consideration age, service and earnings during a career. The Company’s share of net expense for the pension plans was $3 million for each of the years ended December 31, 2018, 2017 and 2016.

The Company is also charged for its share of the costs associated with welfare plans issued by Prudential Insurance. These expenses include costs related to medical, dental, life insurance and disability. The Company's share of net expense for the welfare plans was $3 million, $4 million and $3 million for the years ended December 31, 2018, 2017 and 2016, respectively.

B-68

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Prudential Insurance sponsors voluntary savings plans for its employee 401(k) plans. The plans provide for salary reduction contributions by employees and matching contributions by the Company of up to 4% of annual salary. The Company’s expense for its share of the voluntary savings plan was $1 million for each of the years ended December 31, 2018, 2017 and 2016.

The Company is charged distribution expenses from Prudential Insurance’s agency network for both its domestic life and annuity products through a transfer pricing agreement, which is intended to reflect a market-based pricing arrangement.

The Company pays commissions and certain other fees to Prudential Annuities Distributors, Inc. (“PAD”) in consideration for PAD’s marketing and underwriting of the Company’s annuity products. Commissions and fees are paid by PAD to broker-dealers who sell the Company’s annuity products. Commissions and fees paid by the Company to PAD were $73 million, $62 million and $71 million for the years ended December 31, 2018, 2017 and 2016, respectively.

The Company is charged for its share of corporate expenses incurred by Prudential Financial to benefit its businesses, such as advertising, executive oversight, external affairs and philanthropic activity. The Company’s share of corporate expenses was $8 million, $8 million and $6 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Corporate Owned Life Insurance

The Company has sold three Corporate Owned Life Insurance ("COLI") policies to Prudential Insurance and one to Prudential Financial. The cash surrender value included in separate accounts for these COLI policies was $2,239 million at December 31, 2018 and $2,244 million at December 31, 2017. Fees related to these COLI policies were $25 million, $25 million and $23 million for the years ended December 31, 2018, 2017 and 2016, respectively. The Company retains 10% of the mortality risk associated with these COLI policies up to $0.1 million per policy.

Affiliated Investment Management Expenses

In accordance with an agreement with PGIM, Inc. (“PGIM”), the Company pays investment management expenses to PGIM who acts as investment manager to certain Company general account and separate account assets. Investment management expenses paid to PGIM related to this agreement were $2 million for each of the years ended December 31, 2018, 2017 and 2016. These expenses are recorded as “Net investment income” in the Statements of Operations and Comprehensive Income (Loss).

Derivative Trades

In its ordinary course of business, the Company enters into OTC derivative contracts with an affiliate, PGF. For these OTC derivative contracts, PGF has a substantially equal and offsetting position with an external counterparty. See Note 4 for additional information.

Joint Ventures

The Company has made investments in joint ventures with certain subsidiaries of Prudential Financial. "Other invested assets" includes $33 million and $29 million as of December 31, 2018 and 2017, respectively. "Net investment income" related to these ventures includes a gain of $0.3 million, $2 million and $1 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Affiliated Asset Administration Fee Income

The Company has a revenue sharing agreement with AST Investment Services, Inc. ("ASTISI") and PGIM Investments LLC ("PGIM Investments") whereby the Company receives fee income based on policyholders' separate account balances invested in the AST. Income received from ASTISI and PGIM Investments related to this agreement was $31 million, $29 million and $26 million for the years ended December 31, 2018, 2017 and 2016, respectively. These revenues are recorded as “Asset administration fees” in the Statements of Operations and Comprehensive Income (Loss).

The Company has a revenue sharing agreement with PGIM Investments, whereby the Company receives fee income based on policyholders’ separate account balances invested in The Prudential Series Fund. Income received from PGIM Investments related to this agreement was $5 million, $9 million and $8 million for the years ended December 31, 2018, 2017 and 2016, respectively. These revenues are recorded as “Asset administration fees” in the Statements of Operations and Comprehensive Income (Loss).

B-69

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Affiliated Notes Receivable

Affiliated notes receivable included in “Receivables from parent and affiliates” at December 31, were as follows:



	Maturity Dates			Interest Rates				2018		2017
								(in thousands)
U.S. dollar floating rate notes			2028	3.83%	-	4.25	%	$	6,001	$	6,047
U.S. dollar fixed rate notes	2026	-	2027	0.00%	-	14.85	%	2,823		3,330
Total long-term notes receivable - affiliated(1)								$	8,824	$	9,377


(1)	All long-term notes receivable may be called for prepayment prior to the respective maturity dates under specified circumstances.

The affiliated notes receivable shown above are classified as available-for-sale securities and other trading assets carried at fair value. The Company monitors the internal and external credit ratings of these loans and loan performance. The Company also considers any guarantees made by Prudential Insurance for loans due from affiliates.

Accrued interest receivable related to these loans was $0.1 million at both December 31, 2018 and 2017, and is included in “Other assets”. Revenues related to these loans were $0.3 million, $0.3 million and $0.4 million for the years ended December 31, 2018, 2017 and 2016, respectively, and are included in “Other income”.

Affiliated Asset Transfers

The Company participates in affiliated asset trades with parent and sister companies. Book and market value differences for trades with a parent and sister are recognized within "Additional paid-in capital" (“APIC”) and "Realized investment gains (losses), net", respectively. The table below shows affiliated assets trades for the year ended December 31, 2018 and 2017:



Affiliate	Date	Transaction	Security Type	Fair Value		Book Value		APIC, Net of Tax Increase/(Decrease)
				(in thousands)
Prudential Insurance	June 2017	Sale	Fixed Maturities & Short-Term Investments	$	16,965	$	16,515	$	293
Prudential Insurance	June 2017	Sale	Commercial Mortgages	$	43,198	$	42,301	$	584
Gibraltar Universal Life Reinsurance Company	May 2018	Purchase	Fixed Maturities	$	17,904	$	17,904	$	0

Debt Agreements

The Company is authorized to borrow funds up to $200 million from affiliates to meet its capital and other funding needs. During the second quarter of 2016, the Company reassigned all the remaining debt to Prudential Insurance as part of the Variable Annuities Recapture. See Note 1 for additional information on the reassignment effective April 1, 2016. As of December 31, 2018 and 2017, there was no debt outstanding.

The total interest expense to the Company related to loans payable to affiliates was $0.0 million, $0.0 million and $1 million for the years ended December 31, 2018, 2017 and 2016, respectively.

Contributed Capital and Dividends

In March of 2018, 2017 and 2016, the Company received capital contributions in the amount of $1 million from Pruco Life.

Through 2018, the Company did not pay any dividend. In June of 2017 and April of 2016, the Company paid a dividend in the amount of $100 million and $241 million, respectively, to Pruco Life.

Reinsurance with Affiliates

As discussed in Note 9, the Company participates in reinsurance transactions with certain affiliates.

B-70

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

14. COMMITMENTS AND CONTINGENT LIABILITIES

Commitments

The Company has made commitments to fund commercial loans. As of December 31, 2018, there were no outstanding commitments to fund commercial loans, and $2 million as of December 31, 2017. The Company has made commitments to purchase or fund investments, mostly private fixed maturities. As of December 31, 2018 and 2017, $41 million and $33 million, respectively, of these commitments were outstanding.

Contingent Liabilities

On an ongoing basis, the Company's internal supervisory and control functions review the quality of sales, marketing and other customer interface procedures and practices and may recommend modifications or enhancements. From time to time, this review process results in the discovery of product administration, servicing or other errors, including errors relating to the timing or amount of payments or contract values due to customers. In certain cases, if appropriate, the Company may offer customers remediation and may incur charges, including the cost of such remediation, administrative costs and regulatory fines.

The Company is subject to the laws and regulations of states and other jurisdictions concerning the identification, reporting and escheatment of unclaimed or abandoned funds, and is subject to audit and examination for compliance with these requirements. For additional discussion of these matters, see “Litigation and Regulatory Matters” below.

It is possible that the results of operations or the cash flows of the Company in a particular quarterly or annual period could be materially affected as a result of payments in connection with the matters discussed above or other matters depending, in part, upon the results of operations or cash flows for such period. Management believes, however, that ultimate payments in connection with these matters, after consideration of applicable reserves and rights to indemnification, should not have a material adverse effect on the Company’s financial position.

Litigation and Regulatory Matters

The Company is subject to legal and regulatory actions in the ordinary course of its business. Pending legal and regulatory actions include proceedings specific to the Company and proceedings generally applicable to business practices in the industry in which it operates. The Company is subject to class action lawsuits and other litigation involving a variety of issues and allegations involving sales practices, claims payments and procedures, premium charges, policy servicing and breach of fiduciary duty to customers. The Company is also subject to litigation arising out of its general business activities, such as its investments, contracts, leases and labor and employment relationships, including claims of discrimination and harassment, and could be exposed to claims or litigation concerning certain business or process patents. In addition, the Company, along with other participants in the businesses in which it engages, may be subject from time to time to investigations, examinations and inquiries, in some cases industry-wide, concerning issues or matters upon which such regulators have determined to focus. In some of the Company’s pending legal and regulatory actions, parties are seeking large and/or indeterminate amounts, including punitive or exemplary damages. The outcome of litigation or a regulatory matter, and the amount or range of potential loss at any particular time, is often inherently uncertain.

The Company establishes accruals for litigation and regulatory matters when it is probable that a loss has been incurred and the amount of that loss can be reasonably estimated. For litigation and regulatory matters where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established, but the matter, if material, is disclosed. The Company estimates that as of December 31, 2018, the aggregate range of reasonably possible losses in excess of accruals established for those litigation and regulatory matters for which such an estimate currently can be made is less than $10 million. This estimate is not an indication of expected loss, if any, or the Company's maximum possible loss exposure on such matters. The Company reviews relevant information with respect to its litigation and regulatory matters on a quarterly and annual basis and updates its accruals, disclosures and estimates of reasonably possible loss based on such reviews.

Wells Fargo MyTerm Sales

In December 2016, Prudential Financial announced that it suspended sales of its MyTerm life insurance product through Wells Fargo pending completion of a Prudential Financial-initiated review of how the product was being sold through Wells Fargo. Prudential Financial has offered to reimburse the full amount of premium with interest, to any Wells Fargo customers with concerns about the way in which the product was purchased. Wells Fargo distributed the product from June 2014 until sales were suspended, and Prudential Financial's total annualized new business premiums associated with sales through Wells Fargo were approximately $4 million. Annualized new business premiums include 100% of scheduled first year premiums for policies sold during this period.

B-71

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

Prudential Financial has received inquiries, requests for information, subpoenas and a civil investigative demand related to this matter from state and federal regulators, including its lead state insurance regulator, the New Jersey Department of Banking and Insurance ("NJDOBI"), state attorneys general and federal legislators, and is responding to these requests. Prudential Financial has also received shareholder demands for certain books and records under New Jersey law. Prudential Financial may become subject to additional regulatory inquiries and other investigations and actions, shareholder demands and litigation related to this matter. Prudential Financial has provided notice to Wells Fargo that it may seek indemnification under the MyTerm distribution agreement between the parties. In December 2017, NJDOBI ended its investigation and concluded that there was no evidence of improper activity by Prudential regarding the sale and marketing of MyTerm policies to Wells Fargo customers. In November 2018, the Company and Wells Fargo resolved the Company’s claims emanating from the MyTerm distribution agreement. This matter is now closed.

Unclaimed Property

In 2011 the New York Attorney General subpoenaed the Company, along with other companies, regarding its unclaimed property procedures and may ultimately seek remediation and other relief, including damages. Additionally, in 2011 the New York Office of Unclaimed Funds commenced an audit of the Company’s compliance with New York’s unclaimed property laws.

Securities Lending and Foreign Tax Reclaim Matter

In 2016, Prudential Financial self-reported to the Securities and Exchange Commission ("SEC") and the U.S. Department of Labor ("DOL"), and notified other regulators, that in some cases it failed to maximize securities lending income for the benefit of certain separate account investments due to a long-standing restriction benefiting Prudential Financial that limited the availability of loanable securities. Prudential Financial has removed the restriction and implemented a remediation plan for the benefit of customers. As part of Prudential Financial’s review of this matter, in 2018 it further self-reported to the SEC, and notified other regulators, that in some cases it failed to timely process foreign tax reclaims for the separate account investments. Prudential Financial has corrected the foreign tax reclaim process and has implemented a remediation plan for the benefit of customers.

The DOL's review of the securities lending matter is closed. Prudential Financial is cooperating with the SEC in its review of the securities lending and foreign tax reclaim matters (which includes a review of the remediation plans) and has entered into discussions with the SEC staff regarding a possible settlement of the securities lending matter that would potentially involve charges under the Investment Advisers Act and financial remedies. Prudential Financial cannot predict the outcome of the discussions with the SEC regarding the foreign tax reclaim matter or the possible settlement of the securities lending matter.

Summary

The Company’s litigation and regulatory matters are subject to many uncertainties, and given their complexity and scope, their outcome cannot be predicted. It is possible that the Company’s results of operations or cash flows in a particular quarterly or annual period could be materially affected by an ultimate unfavorable resolution of pending litigation and regulatory matters depending, in part, upon the results of operations or cash flows for such period. In light of the unpredictability of the Company’s litigation and regulatory matters, it is also possible that in certain cases an ultimate unfavorable resolution of one or more pending litigation or regulatory matters could have a material adverse effect on the Company’s financial position. Management believes, however, that, based on information currently known to it, the ultimate outcome of all pending litigation and regulatory matters, after consideration of applicable reserves and rights to indemnification, is not likely to have a material adverse effect on the Company’s financial position.

B-72

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

Notes to Financial Statements—(Continued)

15. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The unaudited quarterly results of operations for the years ended December 31, 2018 and 2017 are summarized in the table below:



	Three months ended
	March 31		June 30		September 30		December 31
	(in thousands)
2018
Total revenues	$	41,606	$	40,709	$	22,789	$	35,368
Total benefits and expenses	30,839		33,648		15,100		29,657
Income (loss) from operations before income taxes	10,767		7,061		7,689		5,711
Net income (loss)	$	10,020	$	6,316	$	7,539	$	7,406
2017
Total revenues	$	37,242	$	26,479	$	24,995	$	35,253
Total benefits and expenses	30,636		20,711		16,722		26,581
Income (loss) from operations before income taxes	6,606		5,768		8,273		8,672
Net income (loss)	$	6,156	$	8,511	$	11,309	$	9,281

B-73

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholder of

Pruco Life Insurance Company of New Jersey:

Opinion on the Financial Statements

We have audited the accompanying statements of financial position of Pruco Life Insurance Company of New Jersey (the "Company") as of December 31, 2018 and 2017, and the related statements of operations and comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2018 including the related notes and financial statement schedules listed in the index appearing under Item 15 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017 and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2018 in conformity with accounting principles generally accepted in the United States of America.

Changes in Accounting Principles

As discussed in Note 2 to the financial statements, the Company changed the manner in which it accounts for certain financial assets and liabilities and the manner in which its accounts for certain tax effects originally recognized in accumulated other comprehensive income in 2018 and the manner in which it accounts for certain reinsurance costs in 2017.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Significant Transactions with Related Parties

As described in Note 13 to the financial statements, the Company has entered into significant transactions with The Prudential Insurance Company of America, and other affiliates.

/s/ PricewaterhouseCoopers LLP

New York, New York

March 7, 2019

We have served as the Company's auditor since 1996.

B-74

PART C:

OTHER INFORMATION

Item 26. Exhibits



Exhibit number			Description of Exhibit
(a)		Board of Directors Resolution:
	(i)		Resolution of Board of Directors of Pruco Life Insurance Company of New Jersey establishing the Pruco Life of New Jersey Variable Appreciable Account. (Note 2)
	(ii)		Amendment of Separate Account Resolution. (Note 5)

(b)		Not Applicable.

(c)		Underwriting Contracts:
	(i)		Distribution Agreement between Pruco Securities, LLC and Pruco Life Insurance Company of New Jersey. (Note 2)
	(ii)		Selling Agreement used from 11-2008 to current. (Note 15)

(d)		Contracts:
	(i)		Variable Universal Life Insurance Contract (VUL-2014). (Note 23)
	(ii)		Variable Universal Life Insurance Contract (VUL-2015). (Note 25)
	(iii)		Rider for Insured’s Accidental Death Benefit - VL 110B-2000 (Note 6)
	(iv)		Rider for Insured’s Total Disability Benefit - VL 100B-2004NY (Note 9)
	(v)		Rider for Insured’s Total Disability Benefit - VL 100B-2007NY (Note 13)
	(vi)		Rider for Level Term Insurance Benefit on Dependent Children - VL 182B-2000 (Note 6)
	(vii)		Rider for Level Term Insurance Benefit on Dependent Children - VL 182B-2005 NY (Note 13)
	(viii)		Rider for Level Term Insurance Benefit on Dependent Children-From Conversions - VL 184B-2000 (Note 6)
	(ix)		Rider for Level Term Insurance Benefit on Dependent Children-From Conversions - VL 184B-2005 NY (Note 13)
	(x)		Rider to Provide Acceleration of Death Benefit – VL 145 B3-2014 (Note 22)
	(xi)		Endorsement providing Type C Death Benefit Provisions - PLY 117-2003 (Note 9)
	(xii)		Endorsement providing Type C Death Benefit Provisions - PLY 117-2007 (Note 13)
	(xiii)		Rider for Excess Loan Protection - PLY 123-2008 (Note 14)
	(xiv)		Rider for Settlement Options to Provide Acceleration of Death Benefits -ORD 87241-91-NY (Note 7)
	(xv)		Endorsement for Type C Death Benefit Option - PLY 130-2013. (Note 20)
	(xvi)		Endorsement for Type C Death Benefit Option - PLY 130-2014. (Note 23)
	(xvii)		Endorsement for Type C Death Benefit Option - PLY 130-2015. (Note 25)

(e)		Application:
	(i)		Application for Variable Universal Life Insurance Contract. (Note 16)
	(ii)		Supplement to the Application for Variable Universal Life Insurance Contract. (Note 4)

(f)		Depositor’s Certificate of Incorporation and By-Laws:
	(i)		Articles of Incorporation of Pruco Life Insurance Company of New Jersey, as amended March 11, 1983. (Note 2)
	(ii)		Certificate of Amendment of the Articles of Incorporation of Pruco Life Insurance Company of New Jersey, February 12, 1998. (Note 3)
	(iii)		Certificate of Amendment of the Articles of Incorporation of Pruco Life Insurance Company of New Jersey, October 1, 2012. (Note 25)
	(iv)		By-laws of Pruco Life Insurance Company of New Jersey, as amended August 4, 1999. (Note 16)

(g)		Reinsurance Agreements:
	(i)		Agreement between Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey") and Munich American Reassurance Company. (Note 9)
	(ii)		Amendments (1, 5, 6, Exhibit A) to the Agreement between Pruco Life of New Jersey and Munich American Reassurance Company. (Note 9)



	(iii)		Amendments (3, 4) to the Agreement between Pruco Life of New Jersey and Munich American Reassurance Company. (Note 21)
	(iv)		Amendment (7) to the Agreement between Pruco Life of New Jersey and Munich American Reassurance Company (Note 12)
	(v)		Amendments (8, 9) to the Agreement between Pruco Life of New Jersey and Munich American Reassurance Company (Note 13)
	(vi)		Amendments (2, 10, 11) to the Agreement between Pruco Life of New Jersey and Munich American Reassurance Company. (Note 14)
	(vii)		Agreement between Pruco Life of New Jersey and Prudential. (Note 11)
	(viii)		Amendments (1-15) to the Agreement between Pruco Life of New Jersey and Prudential. (Note 18)
	(ix)		Agreement between Pruco Life of New Jersey and General Re Life Corporation. (Note 12)
	(x)		Amendment (1) to the Agreement between Pruco Life of New Jersey and General Re Life Corporation. (Note 13)
	(xi)		Amendments (2, 3, 4) to the Agreement between Pruco Life of New Jersey and General Re Life Corporation. (Note 14)
	(xii)		Agreement between Pruco Life of New Jersey and Optimum Re Insurance Company. (Note 12)
	(xiii)		Amendment (1) to the Agreement between Pruco Life of New Jersey and Optimum Re Insurance Company. (Note 13)
	(xiv)		Amendments (2, 3) to the Agreement between Pruco Life of New Jersey and Optimum Re Insurance Company. (Note 14)
	(xv)		Agreement between Pruco Life of New Jersey and RGA Reinsurance Company. (Note 12)
	(xvi)		Amendment (1) to the Agreement between Pruco Life of New Jersey and RGA Reinsurance Company. (Note 12)
	(xvii)		Amendments (2) to the Agreement between Pruco Life of New Jersey and RGA Reinsurance Company. (Note 14)
	(xviii)		Amendments (3, 4) to the Agreement between Pruco Life of New Jersey and RGA Reinsurance Company. (Note 16)
	(xix)		Amendment (5) to the Agreement between Pruco Life of New Jersey and RGA Reinsurance Company. (Note 18)
	(xx)		Agreement between Pruco Life of New Jersey and Scor Global Life Re Insurance Company of Texas. (Note 14)
	(xxi)		Amendment (1) to the Agreement between Pruco Life of New Jersey and Scor Global Life Re Insurance Company of Texas. (Note 16)
	(xxii)		Amendment (2) to the Agreement between Pruco Life of New Jersey and Scor Global Life Re Insurance Company of Texas. (Note 18)
	(xxiii)		Amendments (3, 4) to the Agreement between Pruco Life of New Jersey and Scor Global Life Re Insurance Company of Texas. (Note 21)
	(xxiv)		Agreement between Pruco Life of New Jersey and Scor Global Life U.S. Re Insurance Company. (Note 14)
	(xxv)		Amendment (1) to the Agreement between Pruco Life of New Jersey and Scor Global Life U.S. Re Insurance Company. (Note 14)
	(xxvi)		Amendments (3, 4) to the Agreement between Pruco Life of New Jersey and Scor Global Life U.S. Re Insurance Company. (Note 21)
	(xxvii)		Agreement between Pruco Life of New Jersey and ACE Life Insurance Company. (Note 15)
	(xxviii)		Amendment (1) to the Agreement between Pruco Life of New Jersey and ACE Life Insurance Company. (Note 15)
	(xxix)		Agreement between Pruco Life of New Jersey and Annuity & Life Reassurance, Ltd. (Note 18)
	(xxx)		Amendments (1,2,4) to the Agreement between Pruco Life of New Jersey and Annuity & Life Reassurance, Ltd. (Note 18)
	(xxxi)		Blanket Amendment to the Agreement between Pruco Life of New Jersey and Annuity & Life Reassurance, Ltd. (Note 18)
	(xxxii)		Termination Amendment to the Agreement between Pruco Life of New Jersey and Annuity & Life Reassurance, Ltd. (Note 18)
	(xxxiii)		Agreement between Pruco Life of New Jersey and Scottish Re, Inc. (Note 9)
	(xxxiv)		Amendments (1, 2, 3, Exhibit A) to the Agreement between Pruco Life of New Jersey and Scottish Re, Inc. (Note 9)
	(xxxv)		Amendment (4) to the Agreement between Pruco Life of New Jersey and Scottish Re, Inc. (Note 12)
	(xxxvi)		Amendments (5 & 6) to the Agreement between Pruco Life of New Jersey and Scottish Re, Inc. (Note 13)
	(xxxvii)		Amendment (7) to the Agreement between Pruco Life of New Jersey and Scottish Re, Inc.(Note 18)
	(xxxviii)		Agreement between Pruco Life of New Jersey and Swiss Re (Note 18)



	(xxxix)		Amendments (1-10) to the Agreement between Pruco Life of New Jersey and Swiss Re (Note 18)
	(xl)		Agreement between Pruco Life of New Jersey and Transamerica (formerly AUSA) (Note 18)
	(xli)		Amendments (1-7, 10) to the Agreement between Pruco Life of New Jersey and Transamerica (formerly AUSA) (Note 18)
	(xlii)		Termination Amendment to the Agreement between Pruco Life of New Jersey and Transamerica (formerly AUSA) (Note 18)
	(xliii)		Agreement between Pruco Life of New Jersey and ACE Tempest Life Reinsurance Ltd. (Note 18)
	(xliv)		Agreement (2) between Pruco Life of New Jersey and ACE Tempest Life Reinsurance Ltd. (Note 21)

(h)		Participation Agreements:
	(i)		American Skandia Trust Participation Agreement, as amended June 8, 2005 (Note 10)
	(ii)		Amendment #1 to the Participation Agreement between Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey") and Advanced Series Trust (formerly American Skandia Trust), as amended June 8, 2005 (Note 18)
	(iii)		Participation Agreement between Pruco Life of New Jersey and American Century (Note 13)
	(iv)		Amendment #2 to the Participation Agreement between Pruco Life of New Jersey and American Century (Note 13)
	(v)		Amendment #3 to the Participation Agreement between Pruco Life of New Jersey and American Century (Note 24)
	(vi)		Participation Agreement between Pruco Life of New Jersey and American Funds (Note 19)
	(vii)		Participation Agreement between Pruco Life of New Jersey and Dreyfus (Note 13)
	(viii)		Amendment #3 to the Participation Agreement between Pruco Life of New Jersey and Dreyfus (Note 27)
	(ix)		Amendment #4 to the Participation Agreement between Pruco Life of New Jersey and Dreyfus (Note 27)
	(x)		Amendment #5 to the Participation Agreement between Pruco Life of New Jersey and Dreyfus (Note 27)
	(xi)		Amendment #6 to the Participation Agreement between Pruco Life of New Jersey and Dreyfus (Note 23)
	(xii)		Participation Agreement between Pruco Life of New Jersey and Fidelity (Note 19)
	(xiii)		Amendment # 1 to the Participation Agreement between Pruco Life of New Jersey and Fidelity (Note 19)
	(xiv)		Amendment # 2 to the Participation Agreement between Pruco Life of New Jersey and Fidelity (Note 27)
	(xv)		Participation Agreement between Pruco Life of New Jersey and Franklin (Note 19)
	(xvi)		Amendment #1 to the Participation Agreement between Pruco Life of New Jersey and Franklin (Note 27)
	(xvii)		Amendment #2 to the Participation Agreement between Pruco Life of New Jersey and Franklin (Note 27)
	(xviii)		Amendment #5 to the Participation Agreement between Pruco Life of New Jersey and Franklin (Note 27)
	(xix)		Amendment #6 to the Participation Agreement between Pruco Life of New Jersey and Franklin (Note 27)
	(xx)		Amendment #7 to the Participation Agreement between Pruco Life of New Jersey and Franklin (Note 28)
	(xxi)		Participation Agreement between Pruco Life of New Jersey and Hartford (Note 19)
	(xxii)		Participation Agreement between Pruco Life of New Jersey and Janus (Note 13)
	(xxiii)		Amendment to the Participation Agreement #1 between Pruco Life of New Jersey and Janus (Note 23)
	(xxiv)		Amendment to the Participation Agreement #2 between Pruco Life of New Jersey and Janus (Note 27)
	(xxv)		Participation Agreement between Pruco Life of New Jersey and MFS (Note 13)
	(xxvi)		Amendment #4 to the Participation Agreement between Pruco Life of New Jersey and MFS (Note 19)
	(xxvii)		Participation Agreement between Pruco Life of New Jersey and Neuberger Berman (Note 13)
	(xxviii)		Amendment #1 to the Participation Agreement between Pruco Life of New Jersey and Neuberger Berman (Note 23)
	(xxix)		Amendment #2 to the Participation Agreement between Pruco Life of New Jersey and Neuberger Berman (Note 27)
	(xxx)		Participation Agreement between Pruco Life of New Jersey and Northern Lights (Note 17)
	(xxxi)		Amendment #2 to the Participation Agreement between Pruco Life of New Jersey and Northern Lights (Note 21)
	(xxxii)		Participation Agreement between Pruco Life of New Jersey and The Prudential Series Fund (Note 27)
	(xxxiii)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and Advanced Series Trust (Note 26)
	(xxxiv)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and American Century (Note 27)



	(xxxv)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and American Fund (Note 27)
	(xxxvi)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and Dreyfus (Note 26)
	(xxxvii)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and Franklin (Note 26)
	(xxxviii)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and Janus (Note 27)
	(xxxix)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and MFS (Note 26)
	(xl)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and Neuberger Berman (Note 27)
	(xli)		Shareholder Agreement (22c-2 Agreement) between Pruco Life of New Jersey and The Prudential Series Fund (Note 26)

(i)		Administrative Contracts:
	(i)		Service Agreement between Prudential and the Regulus Group, LLC. (Note 16)
	(ii)		Revised Service Agreement between Prudential and the Regulus Group LLC, a TransCentra company. (Note 21)
	(iii)		Engagement Schedule No. 2 between Prudential and Regulus Group, LLC. (Note 25)

(j)		Not Applicable.

(k)		Opinion and Consent of Christopher J. Madin, Esq., as to the legality of the securities being registered. (Note 1)

(l)		Not Applicable.

(m)		Not Applicable.

(n)		Other Opinions:
	(i)		Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm. (Note 1)
	(ii)		Powers of Attorney: John Chieffo, Caroline A. Feeney, Salene Hitchcock-Gear, Christine Knight, Nandini Mongia, Kent D. Sluyter, Candace Woods. (Note 1)

(o)		None.

(p)		Not Applicable.

(q)		Redeemability Exemption:
	(i)		Memorandum describing Pruco Life Insurance Company of New Jersey's issuance, transfer, and redemption procedures for the Contracts pursuant to Rule 6e-3(T)(b)(12)(iii). (Note 1)

---------------------------------------------------------



(Note 1)	Filed herewith.
(Note 2)	Incorporated by reference to Post-Effective Amendment No. 26 to Form S-6, Registration No. 2-89780, filed April 28, 1997 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 3)	Incorporated by reference to Post-Effective Amendment No. 12 to Form S-1, Registration No. 33-20018, filed on April 16, 1999 on behalf of the Pruco Life of New Jersey Variable Contract Real Property Account.
(Note 4)	Incorporated by reference to Form S-6, Registration No. 333-85117, filed on August 13, 1999 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 5)	Incorporated by reference to Form S-6, Registration No. 333-94115, filed on January 5, 2000 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 6)	Incorporated by reference to Form S-6, Registration No. 333-49334, filed on November 3, 2000 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 7)	Incorporated by reference to Post-Effective Amendment No. 24 to Form S-6, Registration No. 2-81243, filed April 29, 1997 on behalf of the Pruco Life of New Jersey Variable Insurance Account.
(Note 8)	[Note 8 no longer in use.]
(Note 9)	Incorporated by reference to Post-Effective Amendment No. 1 to this Registration Statement, filed April 19, 2005 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.



(Note 10)	Incorporated by reference to Post-Effective Amendment No. 2 to this Registration Statement, filed August 15, 2005 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 11)	Incorporated by reference to Post-Effective Amendment No. 5 to this Registration Statement, filed April 19, 2006 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 12)	Incorporated by reference to Post-Effective Amendment No. 6 to this Registration Statement, filed April 12, 2007 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 13)	Incorporated by reference to Post-Effective Amendment No. 7 to this Registration Statement, filed April 18, 2008 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 14)	Incorporated by reference to Post-Effective Amendment No. 8 to this Registration Statement, filed April 21, 2009 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 15)	Incorporated by reference to Post-Effective Amendment No. 9 to this Registration Statement, filed April 14, 2010 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 16)	Incorporated by reference to Post-Effective Amendment No. 10 to this Registration Statement, filed April 12, 2011 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 17)	Incorporated by reference to Post-Effective Amendment No. 11 to this Registration Statement, filed April 23, 2012 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 18)	Incorporated by reference to Post-Effective Amendment No. 13 to this Registration Statement, filed April 12, 2013 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 19)	Incorporated by reference to Post-Effective Amendment No. 15 to this Registration Statement, filed June 28, 2013 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 20)	Incorporated by reference to Post-Effective Amendment No. 18 to this Registration Statement, filed September 26, 2013 on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 21)	Incorporated by reference to Post-Effective Amendment No. 19 to this Registration Statement, filed April 11, 2014, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 22)	Incorporated by reference to Post-Effective Amendment No. 9 for Form N-6, Registration No. 333‑158637, filed April 22, 2014, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 23)	Incorporated by reference to Post-Effective Amendment No. 20 to this Registration Statement, filed June 27, 2014, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 24)	Incorporated by reference to Post-Effective Amendment No. 22 to this Registration Statement, filed September 5, 2014, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 25)	Incorporated by reference to Post-Effective Amendment No. 24 to this Registration Statement, filed April 10, 2015, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 26)	Incorporated by reference to Pre-Effective Amendment No. 1 for Form N-6, Registration No. 333‑215543, filed June 16, 2017, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 27)	Incorporated by reference to Post-Effective Amendment No. 34 to this Registration Statement, filed April 11, 2018, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.
(Note 28)	Incorporated by reference to Post-Effective Amendment No. 32 to this Registration Statement, filed April 11, 2017, on behalf of the Pruco Life of New Jersey Variable Appreciable Account.

Item 27. Directors and Officers of Pruco Life Insurance Company of New Jersey

The directors and officers of Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey"), listed with their principal occupations, are shown below. The principal business address of the directors and officers listed below is 213 Washington Street, Newark, New Jersey 07102.

DIRECTORS OF PRUCO LIFE OF NEW JERSEY

JOHN CHIEFFO – Director, Vice President, Chief Financial Officer, and Chief Accounting Officer

CAROLINE A. FEENEY – Director

SALENE HITCHCOCK-GEAR – Director

CHRISTINE KNIGHT – Director and Vice President

NANDINI MONGIA – Director and Treasurer

KENT D. SLUYTER – Director, President, and Chief Executive Officer

CANDACE J. WOODS – Director

OFFICERS WHO ARE NOT DIRECTORS

WILLIAM J. EVERS - Vice President and Corporate Counsel

LYNN K. STONE - Vice President, Chief Legal Officer, and Secretary

JORDAN K. THOMSEN - Vice President and Corporate Counsel

ARTHUR W. WALLACE - Senior Vice President, Chief Actuary, Appointed Actuary, and Actuary

Item 28. Persons Controlled by or Under Common Control with the Depositor or the Registrant

Pruco Life Insurance Company of New Jersey, a life insurance company organized under the laws of New Jersey, is a direct wholly-owned subsidiary of Pruco Life Insurance Company ("Pruco Life"). Pruco Life, a life insurance company organized under the laws of Arizona, is a direct wholly-owned subsidiary of The Prudential Insurance Company of America and an indirect wholly-owned subsidiary of Prudential Financial, Inc.

The subsidiaries of Prudential Financial, Inc. are listed under Exhibit 21.1 of the Annual Report on Form 10-K of Prudential Financial, Inc., Registration No. 001-16707, the text of which is hereby incorporated by reference.

Item 29. Indemnification

The Registrant, in connection with certain affiliates, maintains various insurance coverages under which the underwriter and certain affiliated persons may be insured against liability, which may be incurred in such capacity, subject to the terms, conditions, and exclusions of the insurance policies.

New Jersey, being the state of organization of Pruco Life Insurance Company of New Jersey ("Pruco Life of New Jersey"), permits entities organized under its jurisdiction to indemnify directors and officers with certain limitations. The relevant provisions of New Jersey law permitting indemnification can be found in Section 14A:3-5 of the New Jersey Statutes Annotated. The text of Pruco Life of New Jersey’s By-law, Article V, which relates to indemnification of officers and directors, was filed on April 16, 1999, as exhibit Item 26. (f)(iii) to Form N-6 of this Registration Statement on behalf of the Pruco Life of New Jersey Variable Appreciable Account.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

Item 30. Principal Underwriters

(a) Pruco Securities, LLC ("Pruco Securities"), an indirect wholly-owned subsidiary of Prudential Financial, Inc., acts as the Registrant's principal underwriter of the Contract. Pruco Securities, organized on September 22, 2003, under New Jersey law, is registered as a broker-dealer under the Securities Exchange Act of 1934 and is a registered member of the Financial Industry Regulatory Authority, Inc. (“FINRA”). (Pruco Securities is a successor company to Pruco Securities Corporation, established on February 22, 1971.) Pruco Securities' principal business address is 751 Broad Street, Newark, New Jersey 07102.

Pruco Securities acts as principal underwriter and general distributor for the following separate investment accounts and their affiliates:

•Pruco Life Variable Universal Account

•Pruco Life Variable Appreciable Account

•Pruco Life of New Jersey Variable Appreciable Account

•The Prudential Variable Appreciable Account

The Contract is sold by registered representatives of Pruco Securities who are also authorized by state insurance departments to do so. The Contract may also be sold through other broker-dealers authorized by Pruco Securities and applicable law to do so.



(b)
Managers And Officers Of Pruco Securities, LLC

Name and Principal Business Address -------------------------------------------------------		Position and Office with Pruco Securities -----------------------------------------------------------
Salene Hitchcock-Gear (Note 1)		Chairman of the Board, Manager
Michael S. Absher (Note 8)		Manager
Brian A. Barnard (Note 2)		Treasurer
Robert Begun (Note 4)		Vice President
Kevin M. Brayton (Note 5)		Vice President, Manager
John M. Cafiero (Note 2)		Assistant Secretary
David S. Campen (Note 3)		Assistant Controller
Dexter M. Feliciano (Note 1)		Assistant Secretary
Anthony M. Fontano (Note 1)		Vice President, Manager
Peter C. Gayle (Note 1)		Vice President, Manager
Patrick L. Hynes (Note 1)		President, Manager, Chief Operating Officer
Bradford O. Hearn (Note 1)		Manager
Kathleen C. Hoffman (Note 2)		Assistant Treasurer
Hasan Ibrahim (Note 1)		Vice President, Chief Legal Officer, Assistant Secretary
John F. Keenan (Note 6)		Vice President
Milton T. Landes (Note 1)		Vice President
Conway Lee (Note 1)		Secretary
Joseph B. McCarthy (Note 2)		Assistant Treasurer
Charles M. O'Donnell (Note 1)		Vice President
Maggie Palen (Note 2)		Assistant Secretary
Mary Jo Reich (Note 1)		Assistant Secretary
Charles H. Smith (Note 2)		Anti-Money Laundering Officer
Robert P. Smit (Note 3)		Vice President, Controller, Chief Financial Officer, Principal Financial Officer, Principal Operations Officer
Michele E. Talafha (Note 7)		Assistant Vice President
Jordan K. Thomsen (Note 1)		Assistant Secretary
William Wilcox (Note 1)		Vice President, Chief Compliance Officer

(Note 1) 213 Washington Street, Newark, NJ 07102

(Note 2) 751 Broad Street, Newark, NJ 07102

(Note 3) Three Gateway Center, Newark, NJ 07102

(Note 4) 200 Wood Avenue South, Iselin, NJ 08830

(Note 5) 280 Trumbull Street, 1 Commercial Plaza, Hartford, CT 06103

(Note 6) 655 Broad Street, Newark, NJ 07102

(Note 7) Two Gateway Center, Newark, NJ 07102

(Note 8) 10055 Red Run Boulevard, Ownings Mills, MD 21117

(c) Pruco Securities passes through the gross distribution revenue it receives to broker-dealers for their sales and does not retain any portion of it in return for its services as distributor for the Contracts. However, Pruco Securities does retain a portion of compensation it receives with respect to sales by its representatives. Pruco Securities retained compensation of $2,211,393 in 2018, $2,855,401 in 2017, and $2,574,216 in 2016. Pruco Securities offers the Contract on a continuous basis.

The sum of the chart below is $187,214,104, which represents Pruco Securities’ total 2018 Variable Life Distribution Revenue. The amount includes both agency distribution and broker-dealer distribution.



Compensation received by Pruco Securities during the last fiscal year with respect to variable life insurance products.
Principal Underwriter	Gross Distribution Revenue*	Compensation on Events Occasioning the Deduction of a Deferred Sales Load	Brokerage Commissions**	Other Compensation
Pruco Securities	$74,219,455	$-0-	$112,994,649	$-0-

* Represents Variable Life Distribution Revenue for the agency channel.

** Represents Variable Life Distribution Revenue for the broker-dealer channel.

Because Pruco Securities registered representatives who sell the Contracts are also our life insurance agents, they may be eligible for various cash bonuses and insurance benefits and non-cash compensation programs that we or our affiliates offer, such as conferences, trips, prizes, and awards, subject to applicable regulatory requirements. In some circumstances and to the extent permitted by applicable regulatory requirements, we may also reimburse certain sales and marketing expenses.

Item 31. Location of Accounts and Records

The Depositor, Pruco Life Insurance Company of New Jersey, is located at 213 Washington Street, Newark, New Jersey 07102.

The Principal Underwriter, Pruco Securities, LLC, is located at 751 Broad Street, Newark, New Jersey 07102.

Each company maintains those accounts and records required to be maintained pursuant to Section 31(a) of the Investment Company Act and the rules promulgated thereunder.

Item 32. Management Services

Not Applicable.

Item 33. Representation of Reasonableness of Fees

Pruco Life Insurance Company of New Jersey (“Pruco Life of New Jersey”) represents that the fees and charges deducted under the Variable Universal Life Insurance Contracts registered by this registration statement, in the aggregate, are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by Pruco Life of New Jersey.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all of the requirements for effectiveness of this registration statement under Rule 485(b) under the Securities Act of 1933 and has duly caused this post-effective amendment to be signed on its behalf by the undersigned, duly authorized, in the City of Newark, and State of New Jersey on this 11th day of April, 2019.

(Seal)



Pruco Life of New Jersey Variable Appreciable Account
(Registrant)

By: Pruco Life Insurance Company of New Jersey
(Depositor)

By:	/s/ Christopher J. Madin
	Christopher J. Madin
	Vice President and Corporate Counsel

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective Amendment No. 37 to the Registration Statement has been signed below by the following persons in the capacities indicated on this 11th day of April, 2019.



Signature and Title

/s/ *
John Chieffo
Director, Vice President, Chief Accounting Officer, and Chief Financial Officer

/s/ *
Caroline A. Feeney
Director

/s/ *
Salene Hitchcock-Gear
Director
	*By:	/s/ Christopher J. Madin
/s/ *		Christopher J. Madin
Christine Knight		(Attorney-in-Fact)
Director and Vice President

/s/ *
Nandini Mongia
Director and Treasurer

/s/ *
Kent D. Sluyter
Director, President, and Chief Executive Officer

/s/ *
Candace Woods
Director

EXHIBIT INDEX



Item 26.

(k) Legal Opinion and Consent:		Opinion and Consent of Christopher J. Madin, Esq., as to the legality of the securities being registered.
(n) Other Opinions:	(i)	Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm.
	(ii)	Powers of Attorney: John Chieffo, Caroline A. Feeney, Salene Hitchcock-Gear, Christine Knight, Nandini Mongia, Kent D. Sluyter, Candace Woods.
(q) Redeemability Exemption:	(i)	Memorandum describing Pruco Life Insurance Company of New Jersey's issuance, transfer, and redemption procedures for the Contracts pursuant to Rule 6e-3(T)(b)(12)(iii).