This material describes the investment strategy for the managed assets in Northwestern Mutual’s general account and the investment performance of these assets. Third party ratings are subject to change.  The Northwestern Mutual Life Insurance Company, Milwaukee, WI.

OLDWICK, N.J. – MARCH 1, 2010 (Business Wire) A.M. Best Co. has affirmed the financial strength rating of A++ (Superior) and issuer credit ratings of “aaa” of The Northwestern Mutual Life Insurance Company (Northwestern Mutual) and its subsidiary, Northwestern Long Term Care Insurance Company (NLTC)(both of Milwaukee, WI). The outlook for all ratings is stable.
 
The ratings reflect Northwestern Mutual’s leading market position in the U.S. life insurance industry, its highly productive career agency force and its superior risk-adjusted capitalization. The ratings also consider Northwestern Mutual’s very favorable liability profile, solid operating earnings and commitment to mutuality. Northwestern Mutual is one of the largest mutual insurance companies in the United States, with over $167 billion in consolidated statutory assets as of December 31, 2009. A.M. Best has observed that most mutual life insurance companies have weathered the ongoing difficult economic and investment environment more effectively than many of their publicly-traded counterparts.
 
Northwestern Mutual enjoys the competitive advantage of its exclusive distribution system and has been successful in increasing the number of full-time financial representatives over the past year to 6,350 as of year-end 2009. The Northwestern Mutual Financial Network has contributed to the company’s strong persistency and prominent market presence within the traditional individual life arena. While Northwestern Mutual’s overall life insurance sales have declined modestly over the past year, this primarily was due to lower sales of variable life and bank-owned life insurance policies. A.M. Best notes that the company continues to maintain an industry leading market share of new annualized individual whole life premium.
Northwestern Mutual’s sizeable inforce block of traditional individual life insurance produces stable, long-term cash flows, which underpin the organization’s steady operating performance. Additionally, the company’s product portfolio is absent of products containing aggressive secondary guarantees and living benefit riders. The conservative nature of its product portfolio, together with its large block of ordinary life business, translates into one of the most creditworthy liability profiles in the industry. As a result, the company has been able to maintain its strong balance sheet position, despite significant investment losses in recent periods caused by the turmoil in the financial markets.
 
Partially offsetting these positive rating factors is Northwestern Mutual’s above-average aggregate exposure to commercial real estate, below investment grade bonds and equities (both public and private). These asset classes have experienced considerable impairments over the past two years. Due to the economic recession, A.M. Best believes the company may experience further impairments in these higher risk assets in the near term. Furthermore, although strong recruiting results increased the number of financial representatives over the past few years, the retention rate declined in 2009. While A.M. Best acknowledges that this is partially due to stricter productivity standards for newer representatives, Northwestern Mutual may be challenged to continue to increase the number of sales professionals while maintaining historical levels of retention and productivity over the long term.
 
For Best’s Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.
 
The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit
www.ambest.com.

A.M. Best Co.

Analysts
Michael Adams
(908) 439-2200, ext. 5133
michael.adams@ambest.com
or
Thomas Rosendale
(908) 439-2200, ext. 5201
thomas.rosendale@ambest.com
or
Public Relations
Rachelle Morrow
(908) 439-2200, ext. 5378
rachelle.morrow@ambest.com
or
Jim Peavy
(908) 439-2200, ext. 5644
james.peavy@ambest.com