Prudential 2001 Annual Report Download - page 126
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Prudential Financial, Inc.
Notes to Consolidated Financial Statements
10. Reinsurance (continued)
Reinsurance recoverables, included in “Other assets” at December 31, were as follows:
2001 2000
(In Millions)
Life insurance ......................................................................................... $ 795 $ 674
Property and casualty ................................................................................... 694 628
Other reinsurance ...................................................................................... 82 76
Total reinsurance recoverable ............................................................................. $1,571 $1,378
Three major reinsurance companies account for approximately 48% of the reinsurance recoverable at December 31,
2001. The Company periodically reviews the financial condition of its reinsurers and amounts recoverable
therefrom in order to minimize its exposure to loss from reinsurer insolvencies, recording an allowance when
necessary for uncollectible reinsurance.
11. Short-term and Long-term Debt
Short-term Debt
Short-term debt at December 31, is as follows:
2001 2000
(In Millions)
Commercial paper ..................................................................................... $3,182 $ 7,686
Notes payable ........................................................................................ 1,469 2,728
Current portion of long-term debt ......................................................................... 754 717
Total short-term debt ................................................................................... $5,405 $11,131
The weighted average interest rate on outstanding short-term debt, excluding the current portion of long-term debt,
was approximately 3.9% and 6.4% at December 31, 2001 and 2000, respectively.
At December 31, 2001, the Company had $4,215 million in committed lines of credit from numerous financial
institutions, all of which were unused. These lines of credit generally have terms ranging from one to five years.
The Company issues commercial paper primarily to manage operating cash flows and existing commitments, meet
working capital needs and take advantage of current investment opportunities. At December 31, 2001 and 2000, a
portion of commercial paper borrowings were supported by $4,000 million and $3,500 million of the Company’s
existing lines of credit, respectively. At December 31, 2001 and 2000, the weighted average maturity of commercial
paper outstanding was 21 and 25 days, respectively.
Growing and Protecting Your Wealth124