In the ever-growing sea of life insurance companies, choosing the right one can feel overwhelming. Finding a provider with a strong reputation, solid financial footing, and products that meet your specific needs is crucial. This Northwestern Mutual life insurance company review dives deep to explore the company's offerings, strengths, and potential cons, helping you decide if it ranks among the best life insurance companies for you.
Northwestern Mutual boasts a long history and impressive financial strength ratings. They offer a variety of life insurance products, including term, whole, and universal life policies. We'll explore these options in detail, along with customer service ratings and factors to consider before making a decision.
Northwestern Mutual life insurance review
According to the most recent data available, Northwestern Mutual is the country's largest life insurance business, accounting for 9.5% of the total US life insurance market in 2022. The company has very satisfied customers, receives very few complaints, and has outstanding financial stability, earning an A++ rating from AM Best.
It is also one of the oldest life insurance firms, having paid dividends to customers for almost 150 years. However, the organization falls short of providing online services such as quotations and an application process.
Pros:
- High client satisfaction.
- Top-tier financial stability.
- Policies are eligible for dividends.
- No medical exam coverage offered.
Cons:
- Cannot buy without an agent.
- Online capabilities are insufficient.
Company Insurance Overview
Northwestern Mutual is located in Milwaukee and offers a wide range of products across the country, including life insurance, long-term care insurance, and disability insurance.
The corporation was formed in 1857. It paid its first life insurance claims two years later, when an ox collided with a passenger train, killing two people. The claims due exceeded the company's available funds, therefore the president and trustees borrowed money to cover the difference. The policyholders' families were reunited, and the rest, as they say, is history. The company is owned by policyholders, who share in profits through dividends. Dividends have been paid annually for nearly 150 years.
| Year Founded | Kinds of Policies | Payment Options | Customer Service | Official Website |
|---|---|---|---|---|
| 1857 | Term, whole, universal, variable universal | ACH transfer, check | (866) 950-4644, Northwestern Mutual app - Apple / Google | www.northwesternmutual.com |
Specifications
| AM Best Rating | NAIC Score (avg.) | Years In Business | Policy Types | Accepts Credit Cards |
|---|---|---|---|---|
| A++ | N/A | 165 Years | Whole, Term, Universal (UL), Variable Universal (VUL) | No |
Pros and Cons Explain
Pros Explained
Excellent customer satisfaction: Northwestern Mutual routinely ranks high in national customer satisfaction surveys, with the third-lowest number of client complaints (based on size) of the 91 life insurance firms we analyzed.
High-level financial stability: AM Best rated fewer than 10% of the 91 life insurance firms we reviewed as having A++ financial strength. Northwestern is among them. Financial strength closely connects with a company's ability to pay life insurance claims.
Policies eligible for dividends: For more than 150 years, Northwestern Mutual has paid dividends to its policyholders, including term policyholders. The dividend for 2023 is expected to be the company's largest yet, at $6.8 billion.
There is no medical exam coverage available: Typically, when you apply for life insurance, you must have a paramedical examination as part of the underwriting process. Northwestern Mutual offers an accelerated underwriting program for certain products that do not require a medical exam. Just make careful to compare quotations for no-med-test life insurance to quotes for life insurance with a medical exam; the latter policy type may be more cheap in some cases.
Cons Explained
Cannot buy without an agent: While many life insurers offer the option of purchasing term policy online without an agent, Northwestern Mutual does not. You'll need to speak with one to purchase any form of coverage.
Online capabilities are insufficient. Northwestern Mutual's website lacks both online quotes and policy information. For either, you will need to contact an agent.
Complaint Index.
Consider the number of client complaints received by a life insurance firm to determine how satisfied its customers are. According to the National Association of Insurance Commissioners (NAIC), Northwestern Mutual had the third-lowest number of complaints out of the 91 life insurance companies we reviewed.
The NAIC collects customer complaints about insurance firms and utilizes the information to create a complaint index. The complaint index allows you to easily see how many complaints the company got and compare it to other life insurance companies. A complaint index of 1.0 indicates that a company received the expected amount of complaints given its size. A value less than 1.0 indicates that the company received less complaints than expected, while a value more than 1.0 indicates that it received more. Northwestern Mutual's complaint index is quite low. The company's complaint index is less than 0.04 when averaged over three years (2020-2022).
Third-Party Ratings
Northwestern Mutual performs highly in two other third-party rating systems. We went to AM Best for information on a company's financial strength and J.D. Power to assess how companies performed with customers.
AM Best is a credit rating firm that assesses the financial strength of life insurance businesses and scores them on a scale of A++ to D. Northwestern Mutual is rated A++, indicating a high capacity to meet ongoing insurance responsibilities, such as paying claims. Only eight other companies out of the 91 we reviewed achieved an A++ grade.
J.D. Power evaluates the customer experience of the largest life insurance companies in the United States. In their 2022 U.S. Individual Life Insurance Study, J.D. Power placed Northwestern Mutual fourth out of 22 businesses. Northwestern Mutual scored much higher than the average.
Competition
It is beneficial to compare life insurance firms based on major criteria such as financial soundness, customer happiness, and policy types available. We've compared Northwestern Mutual to two of its biggest competitors.
| Insurance Company | Our Coverage Options | Dividends Shared in 2023 | Online Application Process | Our AM Best Rating | Pricing for Term Policies | NAIC Complaint Index (2020-2022 Avg.) | J.D. Power Ranking (2022) |
|---|---|---|---|---|---|---|---|
| Northwestern Mutual | We offer Term, Whole, Universal, and Variable Universal coverage. | We are pleased to have shared $6.8 billion in dividends. | At this time, we do not provide an online application option. | We hold an exemplary A++ rating. | Information is currently not available. | Our average complaint index is a low 0.036. | We ranked 4th out of 22 in the J.D. Power Ranking. |
| New York Life | Our range includes Term, Whole, Universal, and Variable Universal insurance. | We distributed $2.0 billion in dividends. | We do not offer an online application at present. | Our financial strength is rated at A++. | Information is currently not available. | Our average complaint index stands at 0.18. | Our J.D. Power Ranking is 10th out of 22. |
| MassMutual | We provide Term, Whole, Universal, and Variable Universal coverage. | In 2023, we shared 1.9 billion in dividends. | Yes, we offer the convenience of applying online. | We are proud of our A++ rating. | Our term policy pricing is better than average. | Our complaint index over the past three years averages at 0.05. | We are ranked 9th out of 22 in the J.D. Power Ranking. |
Insurance Coverage Options
Fixed-Term Life Insurance:
This insurance type is valid for a set period, often up to 30 years, with a consistent premium throughout. Should you wish to extend your coverage beyond the initial term, the premium may rise. Northwestern Mutual offers:
- Level Term 10: Coverage up to 20 years with a fixed premium for the first decade. If extended, the premium increases.
- Level Term 20: A 20-year coverage with a steady premium.
- Term 10: Coverage for a decade with a yearly increasing premium.
- Term 80: Renewable coverage until age 80, with premiums rising each year.
Policyholders have the option to transition their term insurance into a whole life policy without additional health assessments.
Wole Life Insurance
Whole life insurance offers perpetual coverage, featuring a cash value component that accrues over time, accessible through withdrawals or loans. This option is pricier than term insurance and may exceed the cost of universal life insurance. Coverage continuity is assured with regular premium payments.
Universal Life Insurance:
Universal life insurance provides enduring coverage with greater adaptability than whole life insurance. It allows for adjustments in premium payments and death benefits. However, excessive withdrawals from the cash value can jeopardize the policy. The policy's value is tied to prevailing interest rates, which may necessitate premium adjustments to prevent lapse.
Variable universal Life Insurance:
Variable universal life insurance combines permanent coverage with investment opportunities. The cash value is invested in the market, which carries higher risk and potential for loss. Higher fees are associated with this policy type, and poor investment performance may require increased premiums to maintain the policy.
Insurance Policy Enhancements
Policy Riders Overview:
Riders are optional features that can be added to a life insurance policy to enhance or expand coverage. Northwestern Mutual offers several riders, including living benefits and accelerated benefit riders, which allow for early access to the death benefit under certain conditions. These riders typically incur an additional cost and must be chosen at the time the policy is initiated.
Future Coverage Increase Option:
The Additional Purchase Benefit is a guaranteed insurability rider that enables policyholders to augment their coverage on predetermined future dates without the need for a new application or health assessment.
Disability Premium Waiver:
Should you become disabled, Northwestern Mutual offers a waiver of premium rider that exempts you from premium payments during the period of disability.
Advance Payment for Terminal Illness:
While not technically a rider, Northwestern Mutual allows whole life and certain term policyholders to apply for an early payout of a portion of the death benefit in cases of terminal illness, typically when death is anticipated within six months.
Living Benefit for Long-Term Care:
The accelerated death benefit rider provides the insured with access to a part of the death benefit while still alive if diagnosed with specific long-term care conditions.
Customer Support Details:
Northwestern Mutual's customer service is reachable at (866) 950-4644, Monday through Friday, from 7 a.m. to 6 p.m. Central Time. The company does not currently provide online chat support or an email request form for prospective customers.
Comprehensive Evaluation:
Northwestern Mutual distinguishes itself with a high J.D. Power ranking and a minimal number of customer complaints. Its robust financial strength and longstanding history suggest a strong ability to endure economic fluctuations. However, the company lags behind in online capabilities, such as obtaining quotes and completing applications. For those interested in policies with dividends, direct phone contact is advisable, as most dividend-paying policies are not available for online purchase.
Common Inquiries:
Reliability of Payouts:
Northwestern Mutual is known for its solid reputation and financial health, ensuring timely policy payouts, provided all documentation is correct and premiums are up to date.
Accessing Cash Value:
With Northwestern Mutual's permanent life insurance options, such as whole and universal life, you can access the accumulated cash value. However, the death benefit is inaccessible until the policyholder's passing. Withdrawals may be taxable, and the interest earned on the cash value is subject to taxation.
Policy Cancellation:
You have the right to cancel your life insurance policy at any time. Canceling a policy with an attached cash value will result in the return of those funds, minus any surrender charges. Additionally, any profits from the cash value may be taxable.