Northwestern Mutual Life Insurance: Worth The Investment?

Northwestern Mutual is the largest life insurance company in the United States, capturing 9.5% of the entire U.S. market for life insurance in 2022. The company offers term, whole, universal, and variable universal life insurance policies, and has been impressively paying dividends to its policyholders for more than 150 years. Northwestern Mutual has excellent customer satisfaction ratings, receiving very few complaints and garnering an A++ rating for financial strength from AM Best. However, the company falls short when it comes to online offerings, such as online quotes and an online application process.

Northwestern Mutual's customer satisfaction

Northwestern Mutual is a mutual insurance company, meaning it is owned by its policyholders, not outside shareholders. The company has been in the life insurance business for over 160 years and offers term, whole, universal, and variable universal life insurance. It also provides disability insurance, long-term care insurance, estate planning services, and investment services.

Northwestern Mutual has received recognition for its customer satisfaction. It was ranked #10 out of 22 companies for customer satisfaction in J.D. Power's 2023 U.S. Individual Life Insurance Study. Additionally, it was named one of the World's Most Admired Life Insurance Companies by Fortune® in 2023.

The company's financial advisors are expert listeners who ask questions to understand their clients' goals and priorities. They create personalized plans designed to help clients achieve their financial objectives. Northwestern Mutual's advisors also provide ongoing support and mentorship to help clients stay on track.

Reviews from customers on Indeed.com are mixed. Some praise the company for its positive culture, work-life balance, and helpful management. Others criticize the high-pressure sales environment and unethical leadership. Overall, the company has a rating of 3.7 out of 5 stars on the website.

Northwestern Mutual's financial strength

In 2023, despite challenging market conditions, Northwestern Mutual thrived, generating record operating gains and surplus. The company's investment portfolio has shown consistent year-over-year growth, with total invested assets of over $310 billion and a 5.2% compound annual growth rate over the last decade.

The company's strong financial position is further demonstrated by its ability to pay dividends to policyholders. In 2024, Northwestern Mutual expects to pay out a record $7.3 billion in dividends, and this amount is projected to increase to $8.2 billion in 2025.

The company's strong financial performance, high ratings from major agencies, robust investment portfolio, and ability to pay substantial dividends contribute to its overall financial strength and stability.

Northwestern Mutual's policy options

Northwestern Mutual offers a range of insurance products, including term, whole, universal, and variable universal life insurance. Each type of policy has different features and benefits, catering to diverse financial goals and needs. Here is an overview of Northwestern Mutual's policy options:

Term Life Insurance

Term life insurance provides coverage for a specified period, such as 10, 15, or 20 years. Once the term ends, the policy also terminates. Northwestern Mutual offers two types of renewable term policies: Term 80 and Term 10. The Term 80 policy has level premiums for 10 or 20 years and can be renewed annually until the policyholder turns 80, with increasing premiums upon each renewal. The Term 10 policy is more affordable but has a shorter coverage period of up to 10 years and can also be renewed annually. They also offer level term policies with fixed premiums for the entire duration, available in 10 or 20-year terms.

Whole Life Insurance

Whole life insurance offers lifelong coverage and a guaranteed death benefit. It also accumulates cash value over time, which is guaranteed to grow annually, regardless of market fluctuations. The cash value can be accessed during the policyholder's lifetime and provides tax advantages. Northwestern Mutual's whole life policy can be customized with optional riders, including a waiver of premium, an additional purchase benefit, and an accelerated care benefit.

Universal Life Insurance

Universal life insurance includes a death benefit, cash value, and a higher level of flexibility. Northwestern Mutual offers three options: the Custom Universal Life Policy, the Survivorship Universal Life Policy, and the Variable Universal Life Policy. The Custom Universal Life Policy allows flexibility in premium payments and the option to increase the death benefit. The Survivorship Universal Life Policy covers two individuals and pays out upon the second policyholder's death. The Variable Universal Life Policy offers the flexibility to choose how the cash value is invested, providing the potential for increased growth.

Variable Universal Life Insurance

Variable universal life insurance provides lifelong coverage and allows policyholders to choose how the policy's cash value is invested. This type of policy combines the features of universal life insurance with the investment choices of variable life insurance.

Riders

Northwestern Mutual offers several optional riders that can be added to their life insurance policies, including the waiver of premium, long-term care benefit, and additional purchase benefit. The waiver of premium rider waives premium payments in the event of total disability. The long-term care benefit provides assistance with daily living activities if the policyholder needs care due to a chronic illness. The additional purchase benefit allows the purchase of additional coverage at different ages or after specific life events, regardless of health status.

Northwestern Mutual's riders

Riders are add-ons to your insurance policy that give you specific benefits and protection beyond your base coverage. They are a great way to tailor your policy to meet your needs. While they come at an extra cost, they are an affordable way to customise your policy.

Northwestern Mutual offers a range of riders for its life insurance policies. The most popular ones are:

• Waiver of Premium: This rider waives the insured individual's premium in the event that they become totally disabled due to illness or injury.
• Additional Purchase Benefit: This rider allows the insured individual to purchase additional life insurance at specific ages or after certain life events without needing to prove their insurability.
• Long-Term Care Benefit: This rider provides ongoing care due to chronic illness.

Some other riders offered by Northwestern Mutual include:

• Accidental Death Benefit
• Family Income Benefit
• Accelerated Death Benefit or Accelerated Care Benefit
• Return of Premium
• Child Rider or Spouse Rider
• Cost of Living Rider
• Term Conversion Rider
• Term Life Insurance Rider

Buying a policy from Northwestern Mutual

Northwestern Mutual is the largest life insurance company in the United States, capturing 9.5% of the entire U.S. market for life insurance in 2022. The company has been in the business for over 160 years and offers term, whole, universal, and variable universal life insurance policies.

Northwestern Mutual's life insurance policies are available to people of all ages, with policies offered to applicants as young as newborns and as old as 85 years. The company also offers policies to people with health conditions, although having a terminal cancer diagnosis may disqualify some applicants from a term life policy.

To buy a life insurance policy from Northwestern Mutual, you must go through a Northwestern Mutual agent. You can find an agent by searching on the company's website or filling out a short form to be matched with the best agent for your needs. The agent will help you determine which services are available in your area.

Before you meet with an agent, you can use Northwestern Mutual's online life insurance calculator to get an estimate of the coverage amounts and costs. The calculator takes into account factors like income, location, age, gender, debt, and dependent family members.

When you meet with the agent, they will help you determine which policy is the best fit for your needs. The agent will also walk you through the application process and any required medical exams.

Northwestern Mutual offers the following types of life insurance policies:

• Term life insurance: Offers fixed rates for a level term period. After the level term expires, you can generally renew the policy, but the premiums will increase. Term life insurance does not build cash value and is generally the cheapest type of life insurance to purchase.
• Whole life insurance: Offers fixed premiums and guaranteed cash value accumulation with low risk. Whole life insurance provides lifelong coverage with a guaranteed death benefit.
• Universal life insurance: A type of permanent life insurance that offers lifetime coverage and cash value. Universal life insurance is more flexible than whole life insurance, allowing you to adjust the frequency or duration of premium payments and, in some cases, the death benefit.
• Variable universal life insurance: A permanent life insurance policy with an investing component. Variable universal life insurance is considered risky because the cash value is directly invested in the stock market and can lose value. It also tends to have higher policy fees.

Northwestern Mutual also offers a range of riders, or add-ons, to its life insurance policies, including:

• Accelerated Care Benefit Rider: Allows you to access all or a portion of your death benefit while alive if you are diagnosed with a condition that requires long-term care.
• Additional Purchase Benefit Rider: Allows you to purchase additional life insurance during specific timeframes or after certain life events without needing to prove insurability.
• Waiver of Premium Rider: Credits a monthly premium to your policy if you become disabled and are unable to work.
• Early payment benefit: Whole life and some term policyholders may be able to apply to receive a portion of the death benefit early in the event of a terminal illness.
• Accelerated death benefit: Allows the insured to receive part of the death benefit while still living if they are diagnosed with certain conditions requiring long-term care.

Pros and Cons of Buying a Policy from Northwestern Mutual

Northwestern Mutual has excellent customer satisfaction ratings and receives very few complaints. The company also has superior financial stability, with an A++ rating from AM Best. Northwestern Mutual's policyholders are also eligible for dividends, which have been paid out every year for over 150 years.

However, one downside of Northwestern Mutual is the lack of online capabilities. You cannot buy a policy or get a quote online, and the website does not provide much information about specific policies. The company also does not offer online chat or an online form for non-customers to request an email response.

Additionally, Northwestern Mutual's internal policy costs tend to be higher than those of many competitors, which can result in higher premiums. The company's investment performance has also lagged behind top competitors, which could affect how much cash value you build over time.

Frequently asked questions