Life Insurance 

life insurance 

Life insurance protects the people you care about most. In the unfortunate circumstance that you’re not there to provide for your family, life insurance can.

But life insurance can also be more than just a safety net. It can be the basis of a solid financial plan. At Northwestern Mutual, several of our policies build cash value and are eligible for dividends.1 That’s money you can use to reduce your premiums, increase your coverage, or receive as cash.

Key Features 

Living Benefits 

Permanent Life 

Term Life 

Combination Life 

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Key Features of Life Insurance

Death Benefit

If you die while the policy is in effect, it will provide financial support to the people you care about most.

Cash Value

In addition to the death benefit, many of Northwestern Mutual’s policies have a cash value. In general, cash value grows as you make premium payments and when interest or dividends are credited to the policy.

That’s money you can access through loans or by surrendering some or all of your policy. You could use your cash value to pay for things like college tuition, making a down payment on a house, providing cash for a new business, or helping to fund your retirement.2

Dividend Options

Many of Northwestern Mutual’s policies are eligible for a dividend.1

You may choose to use your policy dividends in multiple ways. Most policyowners choose to use them to increase policy values. You can also use them to help pay your premiums or let them accumulate and earn interest. You can choose to receive your dividends in cash.

Conversion Rights

You may be able to convert some term life insurance policies to permanent life insurance without having to go through the process to prove your insurability a second time.

Additional Purchase Benefit

Adding the Additional Purchase Benefit (APB) to a policy means you lock in the right to buy more insurance in the future based on your health today.

That means, at selected intervals up until you’re 40, you can buy more insurance. Even if you’re diagnosed with an illness or condition that would make it difficult or more expensive to get life insurance, you’re able to buy more insurance at the specified intervals at the same underwriting class as when you initially got your policy.

You can also add the APB to a life insurance policy you are buying for a child. This way, you are not only insuring the child's life, but also protecting the child's ability to purchase additional insurance later in life, no matter what happens to that child’s health.

Indexed Protection Benefit

If things cost more, your death benefit will go up.

What seems like plenty of money today may not be in the future. At the beginning of 1980, the median sales price of a new home in the US was $62,900. 10 years later, at the start of 1990, the median price of a new home was $125,000. At the start of 1996, the price of a gallon of milk was $2.54. By 2013, it was $3.52. On policies where the Indexed Protection Benefit is available, adding the IPB increases your death benefit based on the Consumer Price Index (a common measure of inflation), with an annual cap.

Waiver Benefit

By adding the Waiver Benefit, if you become totally disabled, after a period of time, you don’t have to pay your premiums and your policy stays in effect. During disability, premiums are credited to the policy and, for permanent insurance policies, contributions to the tax-deferred cash value will continue. With term insurance, a disabled policyowner may be even able to convert the term policy to a permanent plan and have those premiums waived as well.

Options Available if Premium Payments Are Missed

Nonforfeiture options on permanent life insurance protect you if you are ever unable to pay your policy premiums. Options may include:

  • Automatic Premium Loan (APL)
    If a scheduled premium payment is missed, money is automatically borrowed from the cash value of a permanent life insurance policy to pay the overdue premium, and interest is charged until the loan is repaid.

  • Extended Term Insurance
    Keeps the full death benefit in force for a limited period of time.

  • Paid-Up Insurance
    Keeps some level of protection in force by using the policy's entire cash value to purchase paid-up permanent life insurance. The face value of the paid-up insurance will, in most cases, be less than the face amount of the original policy, but no further premiums are required. The paid-up policy remains in force until the insured dies.

  • Cash Surrender
    Elect to receive the policy's cash value by surrendering the policy. Any outstanding loan balance and accrued loan interest will be deducted from the cash value
    .

1Dividends are not guaranteed.

2Any loan or withdrawal of cash value will reduce your policy’s death benefit.

NMFN-LI-001 (0214)

Living Benefits of Life Insurance

Life insurance has no equal when it comes to providing for those you care about when you die. At a time when their lives have dramatically changed, your survivors can be financially secure. Because of your foresight, their everyday needs can be met.

But did you know that a permanent life insurance policy is also an excellent foundation for a long-term financial program? Whether you’re wondering if you will be able to retire comfortably or provide for your family in an emergency, a permanent life insurance policy can be one of the best low-risk financial vehicles available to help you provide for future living needs.

Retirement Income

When you retire, you may need more income than your pension plan, 401(k) or Social Security can provide. You may use the cash values in a permanent life insurance policy to supplement your retirement income.

College Tuition

The cash value your policy generates as your child is growing can be used to help pay college tuition costs. Using a life insurance policy’s cash value to pay for college expenses has some important advantages over other education funding methods.

  • Some education funding tools dictate how and when the money you have accumulated must be used to avoid penalties and taxes. Life insurance doesn’t. If you decide not to use your permanent life insurance policy’s cash value to pay for tuition, it just keeps on growing, tax-deferred.
     
  • Permanent life insurance is one education funding vehicle that will not be taken into consideration for the purposes of determining your child’s eligibility for financial aid. This is important if you’re looking to supplement your existing financial resources with financial aid or loans to cover the full cost of your child’s education.

Opportunity Dollars

You can use the cash value to help make the down payment on a new house, provide start-up cash for a new business or take advantage of other opportunities as they arise.

The guaranteed accessibility to the cash value makes permanent life insurance one of the most valuable assets people can own. It can be withdrawn, borrowed, used and replaced repeatedly at the discretion of the policyowner.

Policy loan interest is charged when money is borrowed against your policy. Death benefit proceeds are reduced by any loan balance. Policy dividends, if any, may be affected by policy loans. If the policy is surrendered, proceeds paid will be reduced by any loan balance.  If policy loan balances are not repaid, resulting in a lapse, it may have a tax impact.

Non-guaranteed values and benefits include dividends. The dividend scale is reviewed annually by the Company’s Board of Trustees and is subject to change.

1Dividends are not guaranteed.

NMFN-LI-002 (0214)

Permanent Life Insurance

Permanent life insurance is designed to provide protection for your entire lifetime.

When you die, your beneficiaries will receive your death benefit, generally income tax-free.2

Permanent life insurance also offers cash value that can grow tax deferred. That’s money that you can borrow against or take out of the policy over time.

Our permanent life insurance is also eligible for annual dividends.3 If a dividend is paid, you can use it to buy more insurance, or cover your premiums, or take it as cash.

You should consider permanent life insurance if:

  • You want protection that can last as long as your need it.
  • You want to leave a legacy by giving your death benefit to people or charities you care about.
  • You want a policy that can build cash value and for which the death benefit may increase.
  • You want to accumulate money you can use for life’s emergencies and opportunities.

Northwestern Mutual offers a variety of permanent life insurance options to meet your unique needs.

Compare different types of policies side-by-side.

Learn more about our permanent life products.

1Dividends are not guaranteed.

2As long as sufficient premiums are paid.

3Dividends are not guaranteed, but have been paid on our traditional life insurance policies every year since 1872.

NMFN-LI-003 (0214)

 

Term Life Insurance

Term life insurance offers you coverage for a fixed period of time. Term offers a larger amount of coverage for a smaller amount of premium early on for people who have a temporary need for coverage. Unlike permanent policies, term life insurance does not offer a cash value. It’s an economical way to cover a shorter-term need and make sure the people you care about most won’t have to worry financially if you’re not there to provide for them.

You should consider term life insurance if:

  • You want a large death benefit but need lower premiums currently.
  • Your need for coverage is temporary, perhaps until your children finish college.
  • You’re interested in term conversion, which allows you to convert to permanent insurance over time and to pay rates based on your health when your term policy started.

Compare different types of policies side-by-side.

Learn about our term life products.

1Dividends are not guaranteed.

NMFN-LI-004 (0214)

Combination Life Insurance

Combination life insurance allows you to mix permanent life insurance and a term insurance component combined with additional purchase of paid-up life insurance coverage (death benefit). The policy can be mixed in almost any proportion and generally becomes an entirely permanent plan over time. Combination life insurance gives you an affordable way to purchase permanent life insurance while still offering a large death benefit on the life of the person insured.

You should consider combination life insurance if:

  • You need a flexible and affordable way to purchase permanent life insurance.
  • You want a comprehensive insurance policy with a competitive premium.
  • You want a life insurance policy custom designed for your situation, allowing you to put more emphasis on protection or accumulation.

Compare different types of policies side-by-side.

Learn about our combination life products.

1Dividends are not guaranteed.

NMFN-LI-005 (0214)

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