A.M. Best Affirms Rating for Jackson National Life.

Business Editors

OLDWICK, N.J.--(BUSINESS WIRE)--Feb. 28, 2002

A.M. Best Co. has affirmed the financial strength rating of A+ (Superior) for Jackson National Life Insurance Company, (JNL) Lansing, Michigan, with a negative outlook.

This rating action follows JNL's recently announced $532 million default and impairment charge relating primarily to its bond holdings, which include exposure to Argentina and Global Crossing, the failed telecom group.

The rating affirmation is based upon the continued capital support and financial strength of the company's ultimate parent, Prudential. plc, London. As one of the leading retail financial services organizations in the world, Prudential plc is the largest life insurance company in the United Kingdom. With approximately $240 billion of funds under management, the organization has more than 10 million customers worldwide. JNL is the group's most significant business outside the United Kingdom; and accordingly, A.M. Best considers JNL to be core to Prudential plc's overall operations.

The rating also considers JNL's strong national presence in the individual annuity arena, and its expanding distribution of European Medium-Term Notes. Over the last several years, JNL's market positions have been complemented by diversified distribution sources and excellent service capabilities, which have enabled the company to enjoy very strong growth in individual annuities. As one of the nation's largest writers of fixed individual annuities, JNL enjoys the competitive advantage of meaningful economies of scale, which has contributed significantly to its historically favorable financial performance.

Although during 2001 JNL generated strong operating results from its core operations and had strong asset-liability management capabilities, exposure to a fair number of below investment grade issues -- a sector which performed very poorly -- resulted in a net loss on both a statutory and GAAP basis. Although JNL reduced its non-investment grade exposure to industry levels in 2001, due to the current economic slowdown and the magnitude of such investments -- about 6% of invested assets roughly equal to capital and surplus funds -- A.M. Best has placed a negative outlook on the rating.

Despite the reported net loss in the current year, JNL's capital position on a statutory basis remains adequate, supported by strong gains from operations and a 2001 capital infusion from its parent. A.M. Best believes Prudential plc remains committed to the U.S. market and will continue to support JNL should the need arise.

Although the company operates in the highly competitive retirement and savings arena, in A.M. Best's opinion, JNL's initiatives to expand its product portfolio and build an alternative distribution system well position the company to achieve continued sales growth and improve its long-term earnings capacity.

Also, A.M. Best affirmed the financial strength rating of A+ (Superior) for Jackson National Life Insurance Co. of New York and Brooke Life insurance Company, Lansing Michigan, with negative outlooks.

A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com.