Distribution Agreement

Prudential PLC
24 January 2003


Friday 24 January 2003

   Prudential UK and Zurich Financial services enter into strategic alliance

Prudential UK and Zurich Financial Services have today announced that they have
entered into a strategic alliance which will give Zurich customers access to a
range of Prudential's market leading products. The alliance will take advantage
of the proposed changes to the polarisation rules which will allow Zurich's tied
distribution arm, the Zurich Advice Network (ZAN), to 'gap-fill' with other
companies' regulated products.

The companies have signed an agreement to offer Zurich customers with maturing
pensions an annuity provided by Prudential, post-depolarisation.

Both companies are also actively discussing ways in which ZAN can utilise
Prudential's other market leading products including with-profit bonds.

Prudential is a recognised market leader in annuities and with-profits bonds.
Zurich's 3,500-strong network of fully qualified financial advisers is the
largest network of its type in the UK offering face-to-face advice.

The benefits of the agreement post-depolarisation will be:

  • Zurich customers with maturing pension funds (current brands include
    Zurich Life, Allied Dunbar and Eagle Star) will be offered an annuity
    provided by Prudential, a market leader in the annuity market.

  • The arrangements are expected to produce new annuity premiums in excess of
    £1 billion to Prudential over the next five years.

  • Zurich Advice Network financial advisers will have an enhanced proposition
    drawing on Prudential's range of products and will be able to offer
    face-to-face advice on a wider range of competitive products.

This year, before depolarisation takes place, almost all Zurich customers will
benefit from improved annuity rates through a reassurance arrangement between
Zurich and Prudential.

Commission will be paid in line with structures that are in force for leading
Independent Financial Advisers.

The annuity agreement is a five-year arrangement between Zurich and Prudential
and covers all conventional pension annuities* offered by Prudential. Zurich and
Prudential are free to seek further distribution arrangements for these and
other products.

Andy Briggs, Partnerships Director Prudential UK, said: 'We are committed to
offering the Prudential range of financial products and services through a
multi-channel distribution strategy. This agreement will give Zurich's customers
the opportunity to purchase an annuity from a market leading annuity provider.
We are continuing to develop other opportunities over the coming months as the
marketplace evolves.'

Kevin Ronaldson, Marketing, Customer and Communication Director of Zurich's Life
business said: 'Zurich is committed to offering our customers choice and a full
range of competitive products. This will include 'gap-fill' products from major
brands where we choose not to be the product manufacturer. The combination of a
Prudential annuity and guaranteed face-to-face advice from the Zurich Advice
Network is a compelling proposition for customers and we are looking forward to
developing similar opportunities with Prudential over the coming months'.

ENDS

NOTES TO EDITORS:


 1. * Zurich customers will be able to benefit from a full range of conventional
    annuities, although the agreement does not cover impaired life annuities,
    temporary annuities and flexible annuities and some guaranteed annuities.

 2. Prior to depolarisation, the products will be branded Zurich, and afterwards
    they will be branded Prudential.

 3. This agreement builds on Prudential's current agreements with Abbey National,
    Bradford and Bingley and Woolwich IFAs (WIFAS) who are major distributors of
    Prudential products.


Media Enquiries to:

James Murray                                          Sandra Paul

Media Relations                                       Media Relations

Prudential UK                                         Zurich Financial Services

020 7150 2654                                         01793 505120

Clare Staley

Group Media Relations

Prudential plc

020 7548 3719

Investor Relations Enquiries to:

Rebecca Burrows

Group Investor Relations

Prudential plc

020 7548 3537

Website address:

www.prudential.co.uk


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