I’m assuming you are referring to the Prudential demutualization in 2001 (or similar circumstance). The cost basis to your father is zero.
The cost basis to your mother would be share price on your father’s date of death since this was your father's policy. The value of inherited property is the fair market value (FMV) of the property on the date of the decedent's death or FMV of the property on the alternate valuation date, but only if the executor of the estate files an estate tax return (Form 706) and elects to use the alternate valuation on that return.
Related Resources:
Gifts and inheritances
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