As a mutual company, Northwestern Mutual is owned by its policyholders, who are eligible to receive dividend payments when the company does well. The company expects to pay $5.2 billion in dividends in 2017.
Northwestern Mutual ranked No. 1 out of 18 large companies scored by NerdWallet. NerdWallet’s life insurance company rankings combine its A.M. Best rating, consumer complaints, and J.D. Power’s customer satisfaction score.
A.M. BEST FINANCIAL STRENGTH RATING: A++ (SUPERIOR)
Northwestern Mutual’s financial strength is “superior,” according to rating agency A.M. Best.
Financial strength is important because it indicates how well an insurer can pay claims. It’s especially important when choosing a life insurance company because claims might not be made until many decades after a policy is purchased.
CONSUMER COMPLAINTS: BETTER THAN THE MEDIAN
Northwestern Mutual drew far fewer than the median number of complaints to state regulators in 2015 for a company of its size, according to the latest data from the National Association of Insurance Commissioners.
The association assigns a complaint ratio score to insurance companies, based on the number of complaints to state insurance commissioners, adjusted for market share. The median score is 1. A score less than 1 means fewer complaints. Northwestern Mutual’s score for individual life insurance in 2015 was .04.
J.D. POWER RATINGS: BETTER THAN MOST
Northwestern Mutual ranks among the best life insurance companies for customer service, according to research firm J.D. Power’s 2016 U.S. Life Insurance Study. Northwestern Mutual scored four out of five stars across all five categories — overall satisfaction, annual statement and billing, price, policy offerings and interaction. The company had the third-highest score overall among 21 of the largest U.S. life insurers, behind Nationwide and State Farm.
SPECIAL INSURANCE OPTIONS
Combo term and permanent life insurance: Northwestern Mutual offers a product called CompLife, which provides a base of permanent life insurance with optional term life on top of it. Policyholders can choose the amounts of the term and permanent life coverage. For example, the portion of permanent coverage within the policy can be increased by paying a higher premium. If the policyholder receives dividends from Northwestern Mutual, those can be used to pay for a higher portion of permanent coverage.
Long-term care money from whole life insurance: On its whole life insurance policies, Northwestern Mutual offers an “accelerated care benefit” option, which lets the policyholder access the death benefit to pay for long-term care. The policy’s death benefit and cash value are reduced proportionately according to how much is used for long-term care.
Disability insurance for part-timers and stay-at-home spouses: Northwestern Mutual offers disability insurance policies designed for part-time workers and stay-at-home spouses. The coverage for part-time employees is geared to people who work between 15 and 29 hours. The coverage can expand if their jobs become full-time. The policies for stay-at-home spouses are geared to people who provide care for children or elderly or disabled family members.
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