777917--3/12/2010--PRUCO_LIFE_INSURANCE

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{condition, economic, financial}

{loss, insurance, financial}

{regulation, change, law}

{regulation, government, change}

{tax, income, asset}

{capital, credit, financial}

{debt, indebtedness, cash}

{operation, natural, condition}

{financial, litigation, operation}

The Company is a wholly owned subsidiary of Prudential Insurance and indirectly owned by Prudential Financial. It is possible that we may need to rely on our parent companies to meet our liquidity needs in the future. Our business and our results of operations were materially adversely affected by adverse conditions in the global financial markets and adverse economic conditions generally that began in the second half of 2007 and continued into 2009. Our business, results of operations and financial condition may be adversely affected, possibly materially, if these conditions recur or current market or economic conditions deteriorate. Beginning in the second half of 2007 and continuing into 2009, markets in the United States and elsewhere experienced extreme and unprecedented volatility and disruption, with adverse consequences to our liquidity, access to capital and cost of capital. A recurrence of market conditions such as those we recently experienced may significantly affect our ability to meet liquidity needs, our access to capital and our cost of capital, including capital that may be required by our subsidiaries. Market fluctuations and general economic, market and political conditions may adversely affect our business and profitability. Interest rate fluctuations could adversely affect our businesses and profitability. If our reserves for future policyholder benefits and claims are inadequate, we may be required to increase our reserves, which would adversely affect our results of operations and financial condition. Our profitability may decline if mortality rates, morbidity rates or persistency rates differ significantly from our pricing expectations. We may be required to accelerate the amortization of deferred policy acquisition costs, or DAC, or establish a valuation allowance against deferred income tax assets, either or which could adversely affect our results of operations and financial condition. Our valuation of fixed maturity, equity and trading securities may include methodologies, estimations and assumptions that are subject to differing interpretations and could result in changes to investment valuations that may materially adversely affect our results of operations and financial condition. We have experienced and may experience additional downgrades in our claims-paying or credit ratings. A downgrade or potential downgrade in our claims-paying or credit ratings could limit our ability to market products, increase the number or value of policies being surrendered, increase our borrowing costs and/or hurt our relationships with creditors or trading counterparties and restrict our access to alternative sources of liquidity. Losses due to defaults by others, including issuers of investment securities or reinsurance, bond insurers and derivative instrument counterparties, downgrades in the ratings of securities we hold or of bond insurers, and insolvencies of insurers in jurisdictions where we write business and other factors affecting our counterparties or the value of their securities, could adversely affect the value of our investments, the realization of amounts contractually owed to us, result in assessments or additional statutory capital requirements or reduce our profitability or sources of liquidity. Intense competition, including the impact of government sponsored programs and other actions on us and our competitors, could adversely affect our ability to maintain or increase our market share or profitability. Governmental actions in response to the recent financial crisis could subject us to substantial additional regulation. Changes in U.S. federal income tax law could make some of our products less attractive to consumers and increase our tax costs. Our businesses are heavily regulated and changes in regulation may reduce our profitability. Legal and regulatory actions are inherent in our businesses and could adversely affect our results of operations or financial position or harm our businesses or reputation. The occurrence of natural or man-made disasters could adversely affect our results of operations and financial condition. Our risk management policies and procedures may leave us exposed to unidentified or unanticipated risk, which could adversely affect our businesses or result in losses.

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777917--3/12/2010--PRUCO_LIFE_INSURANCE_CO