Your insurance needs are unique. The solutions you choose should feel like a good fit, not a compromise.
Weigh the different features when choosing a life insurance policy to be sure you select the product that best fits your needs.
Many of our clients find that a combination of different types of life insurance best suits their needs. Working with a Financial Representative, they first determine how much total life insurance is needed. Then they look at how long the coverage might be needed. And, of course, take a careful look at the person’s situation to understand what amount of premium payments is reasonable. Then, they design a solution that may involve multiple policies that add up to the total amount needed, potentially offering some of the benefits of the various types of life insurance.
If interest crediting rates are an important factor in selecting life insurance, consider that some permanent life insurance policies have a less flexible design but offer a higher interest crediting rate. Universal life insurance offers a more flexible design but then would typically have a lower interest crediting rate.
The following chart provides a brief guide to the types of policies Northwestern Mutual offers, some of their features, and when they might be appropriate for your situation.
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| Permanent Life Insurance |
- Life-long coverage
- Guaranteed level premium.*
- Guaranteed minimum death benefit.*
- Guaranteed cash values.*
- Eligible for annual dividends.**
- Dividends can be used to increase policy values.**
- Underlying values are invested in Northwestern Mutual’s general account.
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- You want protection to last as long as you need it, perhaps a lifetime.
- When you need a solid foundation of permanent life insurance.
- When you can commit to paying an ongoing level premium.
- When you need strong policy guarantees.*
- When you want to build cash values with a conservative approach.
- When you want to be eligible for Northwestern Mutual’s dividends.**
- When you want to have the option to change your policy to “paid-up.”
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| Term Insurance |
- Low premiums.
- Premiums are guaranteed for a period.
- Either level or increasing premium plans.
- Various conversion periods.
- Coverage ends after a specified period.
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- To get a lot of coverage for the money.
- When the need is temporary.
- To supplement other coverage, perhaps a permanent life insurance policy.
- When the lowest out of pocket cost is important to you.
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| Combination Life Insurance |
- Potential for life-long coverage.
- Hybrid of permanent and term life insurance.
- Ability to custom design a blend of permanent and term to fit your needs and your budget.
- Dividends** gradually replace term with paid-up permanent insurance.
- Depending on the policy design, coverage for life may be subject to premium increases.
- Underlying values are invested in Northwestern Mutual’s general account.
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- You want protection to last as long as you need it, perhaps a lifetime.
- When you want both the low cost of term and the benefits of building cash value.
- When you want to be eligible for Northwestern Mutual dividends.**
- When you want to have the option to change your policy to “paid-up.”
- When you want premium and/or cash value guarantees.*
- When you need some policy flexibility.
- When you have the ability to pay premiums over an extended period of time.
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| Universal Life Insurance |
- Potential for life-long coverage.
- Greatest amount of premium and death benefit flexibility.
- Choice of increasing or level death benefit options.
- Underlying values are invested in Northwestern Mutual’s general account.
- Coverage for life may require additional premium payments.
- Cash values are not guaranteed; minimum interest crediting rate and maximum policy charges are guaranteed.
- Death benefits are guaranteed for a period for some products.
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- You want protection to last as long as you need it, perhaps a lifetime.
- When you need premium and death benefit flexibility.
- When you want the investment performance of Northwestern Mutual’s general account.
- When you want the opportunity to easily adjust the policy after issue.
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| Variable Life Insurance |
- Potential for life-long coverage.
- High level of premium and death benefit flexibility.
- Choice of increasing or level death benefit options.
- Policyowner chooses how cash values are invested and assumes investment responsibility.
- Coverage for life may require additional premium payments.
- Cash values are not guaranteed.
- Death benefit guarantees are available (Custom Variable Universal Life and Survivorship Variable Universal Life).
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- You want protection to last as long as you need it, perhaps a lifetime.
- When you have a long-term time horizon.
- To supplement other coverage, perhaps traditional permanent life insurance or term insurance.
- When you want your cash values invested more aggressively than Northwestern Mutual’s general account.
- When you can tolerate volatility of investment returns.
- When you have the ability to pay premiums over an extended period of time.
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Universal Life -
Guaranteed
(available only
for ages 50-85) |
- Potential for life-long coverage.
- Ability to design premium to match a death benefit guarantee.
- Little to no cash value.
- Dividends not anticipated.
- Premium at issue for specified death benefit guarantee is guaranteed - will not go up or down.
- Death benefit guarantee is in effect as long as premiums are paid as illustrated and assuming no loans.
- Lowest level guaranteed premium for a guaranteed level death benefit for lifetime coverage.
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- You have a need for permanent life insurance protection, and little need for cash value.
- You want a guaranteed death benefit.
- You are willing to "lock in" a premium for a specified length of time.
- You are willing to trade premium flexibility for a guaranteed death benefit.
- You want certainty of cost - no increases or decreases.
- You are willing to forego growth on death benefit and cash values.
- You are willing to forego policy flexibility to have a guaranteed death benefit.
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*Guarantees are based on the claims-paying ability of Northwestern Mutual and are not a reflection of the performance or stability of money invested in the variable (non-fixed) funds.
**Dividends are not guaranteed.
NMFN-PR-001 (0611)