OLDWICK, N.J.--(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 both ratings is stable.

The ratings reflect Northwestern Mutual’s sizable and mature individual life insurance franchise, conservative operating profile, strong operating performance and superior risk-adjusted capitalization. The ratings also recognize the loyalty and productivity of the Northwestern Mutual Financial Network, its exclusive distribution system, as well as the competitive advantages derived from historically favorable investment, expense, persistency and mortality experience in its core business lines. These advantages allow the company to consistently provide policy owners with dividend rates that are among the industry’s highest, further contributing to the company’s excellent persistency and leadership position in the individual life insurance market.

Partially offsetting these positive rating factors is the recent decline in Northwestern Mutual’s adjusted capital and surplus (including the asset valuation reserve) due mainly to realized and unrealized investment losses. In addition, the company maintains an above average aggregate exposure to private placement bonds, below investment grade bonds, commercial mortgages and equities (both common and private), although historical investment performance has been good relative to the industry. Furthermore, despite an increase in the total number of financial representatives over the past couple of years, Northwestern Mutual may be challenged to continue to grow the number of sales professionals while maintaining current levels of retention and productivity over the long term. However, A.M. Best notes that relative to its peers, Northwestern Mutual’s financial representative productivity and retention rates currently remain quite favorable relative to industry averages.

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. This material describes the investment strategy for the managed assets in Northwestern Mutual’s general account and the investment performance of these assets. The company’s dividend scale interest rate for unborrowed funds reflects the investment performance of the managed assets net of taxes and any contribution to surplus. This rate is used for crediting interest on policy values after deducting mortality and expense charges. Because of the mortality and expense charges, the dividend scale interest rate should not be used as a measure of the policy’s internal rate of return. The dividend scale and the underlying interest rates are reviewed annually and are subject to change. Future dividends are not guaranteed although Northwestern Mutual has paid a dividend every year since 1872. Third party ratings are subject to change.

The Northwestern Mutual Financial Network is the marketing name for the sales and distribution arm of The Northwestern Mutual Life Insurance Company, its subsidiaries and affiliates. Northwestern Mutual Life Insurance Company, Milwaukee, WI.

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