This document is the 2009 annual report for Northwestern Mutual. It summarizes the company's financial results for 2009, highlighting that despite volatility in financial markets, Northwestern Mutual paid over $4.7 billion in policyholder dividends, an increase of 4% from 2008. The report also features interviews with several policyholders who felt financially secure during the economic downturn thanks to their policies and relationships with Northwestern Mutual financial representatives.

1. G o o d d e c i s i o n s , a lw ay s
2009 annual report

2. Always proven: despite the volatility
of 2009, we paid more than twice the life
insurance dividends of our nearest competitor.
edward J. Zore John e. schlifske
Chairman and CEO Northwestern Mutual’s 17th President
results in brief
(in millions) 2009 2008 Change
Policyowner dividends $4,715 $4,547 +4%
Policyowner benefits paid $6,807 $6,071 +12%
Individual life insurance in force $1,176,845 $1,124,147 +5%
Total revenue $21,366 $21,923 -3%
Total assets $167,180 $155,154 +8%
Surplus & asset valuation reserve $14,246 $13,424 +6%
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2

3. l
ast year’s struggling economy and financial markets
badly jostled families and businesses, and i’m pleased
to assure you northwestern Mutual came through
this environment in very good shape.
Most people were relieved to see 2009 come to an end.
However, northwestern Mutual will look back at 2009
as the year that provided ample evidence of how we
thrive during tough times. over the year, we strengthened
our financial position, boosted our commitment to our
policyowners, and reinforced the value of financial security
by increasing our reach.
our surplus position confirms our considerable financial
strength. at the end of the year, total surplus reached
$14.2 billion, an increase of
Good decisions, always more than $800 million over
2008. our commitment to our
policyowners was evident in
our expected dividend payout of more than $4.7 billion —
our second largest payout ever — representing an almost
$200 million increase over the previous year.
certainly, there are some performance measures we’re
keeping an eye on. total insurance premium and net
investment income were down slightly. However, we see
signs of improvement. the number of insurance policies
we sold increased 6% last year, indicating the strong and
growing need for financial security and the trust people
place in northwestern Mutual as a financial partner.
Finally, i want to personally thank you — our 3.3 million
policyowners — for the privilege of serving you over the
course of my 40-year career with northwestern Mutual.
i plan to retire later this year and am grateful for the
opportunity to lead this outstanding company over the past
decade. John schlifske, who has been with our company
for more than 20 years and who shares my devotion to
excellence, is slated to take over as ceo. you can count
on John to carry on our 153-year tradition of exceptional
quality on your behalf.
edward J. Zore
chairman and chief executive officer
3

4. Good decisions, always
our strength and unwavering stability
are rooted in our well-made decisions
since mid-2008, the dramatic news no matter the economic climate, we focus
of the economy’s instability has on remaining consistently strong. in an
shaken the nation as a whole. while unstable world, you can rest assured
newscasts carried stories about the knowing that the responsibility you have
effects on institutions and markets, entrusted to us is honored. our results
most americans felt the impact within remain stable, protecting you against risk.
their homes. the nation talked of
“weathering the storm” — a storm the results speak for themselves. in these
worse than any since the 1930s. extraordinary times, we provided industry-
leading value. northwestern Mutual
maintained the highest available ratings*
we can tell you quite plainly for insurance financial strength from all
that northwestern Mutual four major rating agencies. our brand of
financial security is about giving people
withstood this storm. confidence in their future.
our philosophy requires us to stand this year, our clients — your fellow
always prepared for troubled times.
policyowners — speak for us. they talk
our business model performs about how the way we do business brings a
well in good times and bad, despite feeling of security to people’s lives in trying
upheavals such as the civil and world times. Five clients report their experiences
wars and the Great depression. we have over the last year or so. they confirm
paid dividends every year since 1872. that they, too, have made good decisions.
the work they do with their financial
we are proud that today our financial
representatives has helped them weather the
strength remains solid.
storm and continue on the path to financial
security. they feel on the right track at a
we have never cracked under economic time when so many americans have worried
pressure. in fact, we plan for such times. about where they are headed.
we have always paid a dividend
to our policyowners since 1872.
*Third-party ratings are subject to change.
4

5. starting early to secure their future Q As a young family,
how have the economic
events of the last year
Brian and Jill Koch are just starting out. This young couple affected you?
understands that life holds risk. In 2005, Brian lost his mom.
A we’ve experienced losses
“We know what can happen, and we want to be prepared.” like so many others have. But
while others were losing so
much, we found we were
As a result, Brian and Jill own life insurance, disability
actually doing pretty well in
insurance, an IRA and have pre-funded two-year-old Brooke’s terms of the big picture. the
college education. They willingly make sacrifices now, reason: as we watched the
controlling spending and investing for the long term. They crisis unfold, we knew a big
part of our strategy — whole
faced last year’s crisis with a new baby and Jill no longer
life insurance — was protected.
a wage earner. A rising attorney at a national firm, Brian of course, an insurance policy
believes in being prepared. Financial Representative Darling is only as good as the company
Lie-Nielsen is helping the young family work toward building behind it. we recognized early on
that we don’t need glamour; we
a secure financial future.
need stability. and that’s what
northwestern Mutual offers.
Q You’ve made farsighted
financial decisions when
most young couples aren’t
thinking that way. Why?
A when we first started
working with darling, she
urged us to budget properly and
do the right things to create a
foundation for our own and our
daughter’s future. Her approach
included instilling in us the
Darling Lie-Nielsen, Financial representative — miami, Florida
importance of setting money
aside, as well as investing it. our
“We work very hard preparing for work led to the feeling of comfort
we had during all the financial
their future, so they can rest easy. upheaval. with her help, we’ve
They’re doing smart things.”
5

6. worked on balancing our needs and wants we need — like saying no to some luxuries
and taking the actions needed to reach our because we know we have a greater plan.
goals. and that’s made us confident in the it’s feeling safe in our financial choices and
future as well. we have contingency plans, making sure they reflect the best decisions
we have protection in place, and we have a for our daughter. it’s knowing we’re laying
game plan to meet whatever comes our way. the foundation to achieve future success.
Q What does financial security mean to you? we’ve seen friends laid off and a number
of talented people forced to switch jobs
A to us, financial security is about ensuring our during this past year. Markets go up, and
hard work supports something that lasts. it’s markets go down; people make and lose
less about what we want and more about what money. Financial security has to factor in
coping without mom
Last year, Gregory Johnson lost his wife, Yolanda, at age 37. Now he is raising his daughters,
Jamille and Jada, ages 8 and 4, alone. Yolanda’s disability insurance and her life insurance
have played a major role in helping Greg and the girls through the loss. Greg speaks of Financial
Representative Kevin Chadwick — who himself lost his mother when he was three years old —
as a trusted ally.
Q As a widowed father, how have the
economic events of the last year
affected you?
A this financial crisis has been a time
of uncertainty for most people, and i’m
no exception. However, in my case, the
circumstances were even worse. My wife,
yolanda, who was healthy and never
smoked, was diagnosed with terminal
lung cancer last year. she passed away
Kevin Chadwick, Financial representative — Dallas, texas shortly thereafter. My life was in disarray.
Fortunately, i didn’t have to worry
financially. yolanda’s northwestern Mutual
“I talk to people about things disability income insurance helped pay
they’d rather not think about — expenses during her illness. and then the
company handled the life insurance claim
to see through smaller challenges quickly and professionally.
to the bigger vision.” so even when everyone was questioning
their investments and strategies, i felt
safe and secure. i knew i was in a good
position with northwestern Mutual,
a well-grounded company with a solid
business model. it’s tried and true and
6

7. safeguards that protect people against
such outside forces or it’s not going to
work. Knowing that we have a plan we always focus on the
that’s been proven to navigate through
tough times, we feel confident we long term, not the latest fads.
made the right decisions — and that
we will be secure in the future.
Greg credits Kevin with the advice that
has helped the family during this difficult
period. What’s more, Greg trusts Kevin
to help him prepare for the family’s future.
enduring. it has stood the test of
time with consistent qualities and
performance.
Q Do you feel financially stable
despite what you’ve experienced
in the last year?
A if i had done it my way, i might not
have purchased all the insurance coverage VIeW our ClIent VIDeos onlIne:
that turned out to be a lifeline for my northwesternmutual.com | about northwestern mutual | our Company | annual report
two young daughters and me. without
it, we would have been financially
devastated. But with help from Kevin and
northwestern Mutual, we are financially Q What does financial security mean to you?
stable and will continue to be so. we’ve
maintained a consistent lifestyle — and A it means that i can prioritize what’s important.
that’s an important thing when we’ve Because of northwestern Mutual, i have been able
been through so much. From this to take a leave of absence from work — even during
experience, i know that Kevin will a tough economy — to spend more time with my
anticipate my needs; he will recommend daughters to rebuild their confidence after losing their
appropriate adjustments; and he will mom, as well as take care of myself. Financial security
help me take actions that are right for affords me the time to see to it that these two little girls
my family and me. get their emotional footing back. that’s a blessing.
7

8. starting a business in an unstable economy
Clark McGhee’s employer failed last year. However, faced uncertainties. Clark believes the advice that Jeff
Clark and his wife, Pam, are planners and savers who has given the couple over the years has helped them
have worked very closely with Wealth Management to seize this business opportunity without risking the
Advisor Jeff Miller for more than a decade. As a family’s current well-being or the couple’s distant future.
result, the couple felt financially secure enough to
Because the McGhees have built up significant cash
start a new business venture in this “down” economy.
value in permanent life insurance and assets in their
The couple knows success. Clark has held executive retirement account, they have given themselves options.
positions with several financial services firms; Pam If needed, they could use that money to help fund their
retired from a thriving medical practice. Still, they children’s educations or develop Clark’s business.
Wealth management Q You’re making career changes with
advisor Jeff miller offers children nearing college. How has
investment advisory
the last year affected you?
services to the mcGhees
through northwestern
mutual Wealth management
A Pam: the last year’s crisis felt like an
Company, a limited purpose emotional roller coaster. we were even closer
federal savings bank. to it than many because clark was working
for a huge firm in the financial services industry.
and then clark’s company went under.
Clark: Fortunately, we had started to work with
Jeff Miller, Wealth management advisor — Jeff a few years ago when pam wanted to retire
richmond, Virginia from her medical practice. our conversations
centered on where we were then and where
“Our work is very strategic and very we wanted to be in the long term. so we took
actions: like purchasing whole life insurance
disciplined. The McGhees’ plan gives policies, balancing our portfolio and investing
them confidence in their future.”
still on track for
Sharon Grayden and Steve
Bayne have spent the
last few years dreaming
of retirement. They’ve
done everything right:
life and long-term care
insurance, investments
and annuities. They came
to Wealth Management
Advisor Delynn Alexander
8

9. in our home. in short, together we had implemented Q What does financial security mean to you?
a plan that would weather a storm like the one we
experienced in the last 12 months. A Clark: that was one of the first questions Jeff
asked us — and our answer was “having our bases
the result was that, when the storm came, we didn’t covered.” during our first 15 years of marriage, it
overreact. Having a sound advisor and a sound firm — meant disability income insurance in case there was
and having planted good seeds years ago — meant an accident or illness; college funds for the kids;
we didn’t have to make fast choices or emotional ones. minimal debt; life insurance in case of premature
death; will and trust vehicles; cash for emergencies;
Q Did you question your decisions at any point? not having to depend on our kids to take care of us
in our later years.
A Pam: it’s only human to do that, of course. we both
talked to Jeff on several occasions about where we Pam: today, our thoughts center on “what’s next?”
stood and whether there was anything we should do. Because we made good decisions early, now we have
the luxury to think about new things. clark is able
Clark: what we never doubted was that Jeff was the to start a new business that’s already showing signs
right person or that northwestern Mutual was the of success. working with a strong company and an
right company. it would have simply been too much if advisor who helped us develop a solid plan and execute
we felt the need to question our advisor or our firm. it, we have options. and that’s a great feeling.
retirement, despite the economy Q As you near retirement, how have
the economic events of the last year
affected you?
and Associate Financial Representative
Reena Bland after the last national crisis, A like most americans, we didn’t take
the crisis lightly. But our concern wasn’t
September 11, 2001, when they saw their
the kind that made us lose sleep, partly
investments — through a different broker — because we are optimists, but also because
drop considerably. of the relationship we have with delynn,
reena and northwestern Mutual.
Like most people, Sharon and Steve were
when we first developed our financial
affected by last year’s economic turmoil, but
plan, delynn coached us to remember
the good news is that their retirement dreams that we were in this for the long haul.
of a flat in Paris or Amsterdam and traveling the she reminded us that we would likely
world are intact and on schedule.
9

10. Wealth management advisor Delynn alexander (right) offers
investment advisory services to sharon Grayden and steve bayne
through northwestern mutual Wealth management Company,
a limited purpose federal savings bank.
experience peaks and valleys but stressed
the importance of keeping our eyes on our
goals. and we’ve continued to make sure
the plan provides a practical long-term
Reena Bland, associate Financial representative; Delynn Alexander, view, taking into account our changing
Wealth management advisor — Chapel Hill, north Carolina
needs and interests.
so at the beginning of the market slide,
“It’s so rewarding to watch people you we were concerned about where the bottom
care about achieve the things that are might be, but we never questioned the validity
of our plan. Fundamental to our plan was
important to them.” protecting against the risks of life and taking
advantage of potential opportunities.
Managing money for the family
Adelaide Daniels Key is a high-energy woman
who is “sort of” retired. She keeps her
hand in several businesses and is an active
philanthropist. A cancer survivor herself,
she’s helped thousands of people cope
with cancer through her work and generosity.
Q As someone who is retirement age,
how have the economic events of
the last year affected you?
A i didn’t grow up with money, so i never
expected to have it. that happened when a
company offered to buy our family newspaper.
suddenly, i had a great deal of money. Because
it was so sudden, i found myself buying things
i didn’t need. i’m very thankful that people i
trusted advised me well, helping me refocus, so
that my efforts and resources would be used in
ways that will make a difference.
so even before this financial upheaval, i didn’t
spend exorbitantly. My response has been to
make some cutbacks and to rely on don and
charlie. with their help, i have continued to
feel secure. don and i have met frequently
to look at where i am financially, but i never
questioned any of my decisions about financial
products — those were good decisions.
10

11. Q How would you describe your relationship when we first sat down to sketch out a plan,
with Delynn and Reena? we discussed the lifestyle we wanted to maintain
and the things we wanted to do in the future.
A this was a relationship formed on trust. For we looked at how we were living and decided
years, we had been searching for someone who we didn’t want to live differently in the first phase
would ask us the important questions. we finally of our retirement. in fact, we hope to do more —
found delynn and reena. they were interested in like have a property in europe, for example. then
us — not just selling us something or impressing we considered what we would need for the phase
us with their technical knowledge. we know that after that. we also considered how we could
delynn and reena are working for us, and we support causes that are important to us. when
trust that northwestern Mutual will live up to its you have the ability and control to direct money
reputation of strength and stability for us. to something you believe in, it’s a great pleasure.
we have prioritized our goals and now know how
Q What does financial security mean to you? to focus on what we want. we trust our plan, the
A it means having a plan that will allow us to people working for us and northwestern Mutual.
reasonably transition through the rest of our
lives without the typical financial shortfalls.
and helping others
Adelaide came into money later in life. She will tell you
that with money comes responsibility. Since then, she has
worked to get her financial house in order for herself, her
family and her philanthropy. Adelaide praises husband-
and-wife-team Don and Charlie Reed — he, a wealth
management advisor, and she, a long-term care specialist —
for helping her use her money wisely. Charlie Reed, Financial representative; Don Reed, Wealth management
advisor — asheville, north Carolina
“The first question we always ask is
i believe this economic turbulence has helped
people realize what they actually do have and ‘what are your goals, your dreams?’ Once
perhaps better understand others who are
not as fortunate. i’m watching people change
we know the answers, we can help.”
their attitudes, and that’s a good thing. Wealth management advisor Don reed offers investment advisory services to
adelaide Daniels Key through northwestern mutual Wealth management Company,
a limited purpose federal savings bank.
Q What drives you to work on behalf of
others, rather than slow down and take
it easy? Q What does financial security mean to you?
A My grandfather, who built that newspaper, A i have enough to eat, a house to live in, a car
also taught me it was important to give back. to travel with. i want to be independent as long
when i had friends who came into asheville as i can and not leave my children any debt. and
for medical treatment who couldn’t afford i have financial representatives i trust. when don
accommodations, i opened my home. it was and i first talked about financial security issues,
then i saw a need and an opportunity — to he realized i didn’t know much — so he started
build a hospital hospitality house and run explaining, and i listened. i was teachable because
it with volunteers. everyone thought i was i knew that i didn’t know enough. He challenges
out of my mind, but it works. over the me and doesn’t always agree with me. He and
years, don has helped me figure out many charlie make sure everything we talk about fits
things. i trust him. He’s a good friend and my life, not someone else’s. all these things put
a good advisor. together make up financial security for me.
11

12. 09
Financial
strenGtH and security
northwestern Mutual’s basic financial goal remains the same in any
economic environment: to pay a level of dividends that delivers the
results highest product value to policyowners without compromising the
company’s superior financial strength and stability.
Financial strenGtH our commitment to long-term
as the economic and financial financial security for our policy-
market turmoil carried over into owners and clients.
2009, the strength and stability of
during 2009, surplus and
financial institutions were again
asset valuation reserve (aVr)
put to the test. northwestern
increased $822 million to
Mutual met these challenges
$14.2 billion. surplus provides
by remaining true to our time-
the company and our policy-
tested strategy, including prudent
owners with protection against
management of insurance product
the unexpected, while aVr
risk; careful attention to operating
supports our long-term investment
expenses; and a well-balanced,
strategy by cushioning against
diversified general account
market volatility.
investment portfolio. these
fundamental priorities, along with
surplus our commitment to mutuality
at year-end 2009, surplus and
ratio
aVr represented 11.4% of
and the financial flexibility of our general account insurance reserves,
participating dividends, enable the approximately the same as one
11.4%
company to weather even extreme year earlier. this level of surplus
financial stress — and deliver on remains very strong relative to the
OuR FINANCIAL
POSITION remains
strong — ASSuRING Surplus Ratio
THAT THE COMPANY (surplus and AVR as a percentage of general account insurance reserves)
CAN KEEP ITS
tal assets
PROMISES TO 15%
POLICYOWNERS.
billions)
12%
$150
9%
125 6%
3%
100
0%
1974 1979 1984 1989 1994 1999 2004 2009
75
Surplus AVR
12 50

13. company’s risk profile
and regulatory benchmarks.
it also compares favorably to
our historical standards for
a strong financial position.
n $8 million
in dividends paid to long-
term care policyowners
through our subsidiary,
09
Financial
Mutuality and
Northwestern Long Term
Care Insurance Company;
results
policyowner Value and
northwestern Mutual is
managed for the long-term n $28 million
benefit of our policyowners. in dividends on individual
this mutual perspective requires fixed and variable annuity
a balance between participating contracts.
dividends and long-term
financial strength and security.
participating dividends reflect the dividend scale interest
our underlying claims rate on most unborrowed
total
assets
experience, expense structure permanent life insurance
and investment performance. funds will be 6.15% during
2010, down from 6.5%
in total, dividends to policy- during 2009. while important,
owners are estimated to be Total assets
investment performance is (in billions)
more than $4.7 billion in 2010. only a part of permanent
this represents an increase of $175
life insurance policyowner
almost $200 million over the value. our favorable claims
2009 payout and is expected to 150
experience and rigorous
be the second-highest payout of approach to expense manage-
dividends in company history. 125
ment account for more than
this includes: one-half of total dividends to
100
be paid during 2010.
n $4.3 billion
in dividends on superior product value 75
contributes to policyowner
participating permanent
satisfaction and loyalty. 50
life insurance policies;
our persistency rate for life
insurance in force was 96% 25
n $120 million during 2009. life insurance
in dividends on term life
policyowners used 76% of 05 06 07 08 09
insurance policies; dividends paid during 2009 to Total investments
purchase additional insurance Separate account assets
n $225 million protection, contributing
Other assets
in dividends on individual to a 5% increase in total life
disability insurance insurance in force that reached
Premium revenue
policies, an 11% increase $1.2 trillion at year-end 2009. (in billions)
over the prior year; $15
13
12

14. 1974 1979 1984 1989 1994 1999 2004 2009
Surplus AVR
our favorable experience with insurance
claims and rigorous expense management
account for more than one-half of total dividends.
diversified
assets
A WELL-BALANCED AND inVestMent results term, but for which market
DIvERSIFIED PORTFOLIO the company’s general values can be volatile. this
CONTRIBuTES TO THE account investment portfolio time-tested investment strategy
COMPANY’S ExEMPLARY
is diversified and largely is made possible by a strong
DIvIDEND RECORD.
comprised of high-quality, surplus position and the stable
General account fixed-income assets, appropriate nature of our participating life
managed investments for our investment strategy insurance products.
(excludes policy loans)
to provide superior returns
northwestern Mutual maintains
over the long term while
a very strong liquidity position.
managing overall credit, market
72% at year-end 2009, the company
and interest-rate risk. our
held $26 billion in cash equiv-
investment guidelines limit
12% alents, u.s. treasurys and
exposure to any single asset
16% other highly liquid, government-
class or issuer.
supported investments. we enjoy
At year-end 2009 the $91 billion bond portfolio substantial positive operating
72% Bonds & cash
represents 70% of our general cash flows, primarily from
16% Mortgage loans account managed investments our large and stable block of
12% Stocks & and remains the cornerstone participating life insurance
other equities
of our investment strategy. business and general account
this portfolio of public and investment portfolio. the
private debt remained high- company’s net operating
quality and well-diversified cash flow was $8.3 billion
by sector, with 90% rated as during 2009.
investment grade at year-end
in total, general account
2009. the company’s $21 billion
investments generated
commercial mortgage loan
$349 million in net realized
portfolio, underwritten by our
Bond own real estate professionals,
and unrealized capital gains
during 2009, after taxes and
portfolio
enjoys significant collateral
required deferrals of interest
protection and is well-
rate-related gains. these net
THE $91 BILLION BOND
diversified geographically
gains contributed to surplus
PORTFOLIO remains and by property type.
growth during 2009 and
the cornerstone OF
OuR GENERAL ACCOuNT equity investments include represented a substantial
INvESTMENT STRATEGY. public and private common improvement from the net
stocks, real estate and other capital losses incurred during
holdings that enhance total the financial market turmoil
portfolio returns in the long of 2008.
14

15. 09
operatinG results at year-end 2009. operating Total assets
total premium revenue, results for 2009 also reflected (in billions)
including both new and renewal our continued commitment to $175
premiums, was $13 billion for the rigorous management of
2009, a decrease of 4% from operating expenses. 150
2008. this decrease was due
primarily to the change in the after provision for taxes and Financial
125
life insurance dividend interest dividends to policyowners, results
rate to 6.5% for 2009, which net gain from operations was 100
reduced the amount of dividends $475 million for 2009. the
available to policyowners for 2008 net gain of $1.1 billion 75
purchase of additional life included the benefit of a
significant, one-time reserve 50
insurance protection. premium
revenue for disability and long- adjustment. net income,
which includes net realized 25
term care insurance increased
4% and 17%, respectively. capital gains and losses,
was $321 million for 2009. 05 06 07 08 09
net investment income net realized capital losses premium
Total investments
Separate account assets
revenue
was $7.8 billion for 2009, primarily reflected impairment Other assets
a 1% decrease from 2008, adjustments for investments —
primarily reflecting lower interest offset in large part during 2009
rates. during 2009, the company by realized capital gains on Premium revenue
(in billions)
directed most new investments selective sales of real estate and
$15
to investment-grade corporate other equity investments. net
bonds and government-supported realized capital losses improved
mortgage-backed securities. significantly over 2008. 12
Benefits paid to policyowners looKinG aHead
or their beneficiaries totaled while the economic and financial 9
$6.8 billion during 2009, market environment appears
a 12% increase from 2008. to be improving, significant
6
Mortality and other claims risks and uncertainties remain.
experience remained favorable northwestern Mutual remains
during 2009, a reflection of the strong, stable and committed 3
company’s careful assessment to our promise of financial
of insurance risk. the increase security to our policyowners and
in benefits paid was largely clients. our focus on long-term 05 06 07 08 09
offset by a lower net increase policyowner value and financial Life insurance
Disability/
in benefit reserves compared strength will remain constant Long-term care
with 2008. reserves for future regardless of the challenges that Annuity
policy benefits were $125 billion may lie ahead.
we have received the best possible
insurance financial strength rating from
the four major rating agencies.
15

16. 09
SuMMARy of opeRAtioNS
(consolidated statutory basis, in millions)
Year ended December 31: 2009 2008
Premiums $13,062 $13,551
Net investment income 7,772 7,835
Other income 532 537
Financial Total revenue 21,366 21,923
results Policyowner benefits paid 6,807 6,071
Increase in benefit reserves 7,138 8,389
Commissions and expenses 2,189 2,070
These summary financial
statements are derived Total benefits and expenses 16,134 16,530
from the company’s audited Gain before dividends and taxes 5,232 5,393
consolidated financial
Policyowner dividends 4,715 4,547
statements, which are
prepared on the statutory Gain before taxes 517 846
basis of accounting. Income tax expense (benefit) 42 (304)
Insurance regulators require Net gain from operations 475 1,150
that financial statements
Net realized capital gains (losses) (154) (667)
be prepared on a statutory
basis of accounting that Net income $321 $483
differs materially from
financial statements SuMMARy of fiNANCiAL poSitioN
prepared in accordance (consolidated statutory basis, in millions)
with generally accepted
Year ended December 31: 2009 2008
accounting principles (GAAP).
Bonds $91,004 $79,314
Mortgage loans 21,024 21,677
Policy loans 13,717 12,884
Common and preferred stocks 5,918 5,744
Real estate 1,582 1,528
Other investments 8,587 9,185
Cash and short-term investments 2,610 4,807
Total investments 144,442 135,139
Other assets 6,394 6,628
Separate account assets 16,344 13,387
Total assets $167,180 $155,154
Policy benefit reserves $125,025 $117,954
Policyowner dividends payable 4,730 4,555
Other liabilities 6,835 5,834
Separate account liabilities 16,344 13,387
Liabilities (excluding AVR) 152,934 141,730
Asset valuation reserve (AvR) 1,843 1,023
Surplus 12,403 12,401
Surplus and AVR 14,246 13,424
Total liabilities and surplus $167,180 $155,154
PricewaterhouseCoopers LLP is the company’s independent auditor. The accompanying financial information
is derived from the company’s audited consolidated financial statements. The company’s audited
consolidated financial statements are available at www.northwesternmutual.com or by written request to
Northwestern Mutual, Corporate Relations, Room N04, 720 E. Wisconsin Ave., Milwaukee, Wisconsin 53202.
16

17. Marna P. Borgstrom, President and Chief
Executive Officer, Yale-New Haven Hospital
and Yale-New Haven Health System,
New Haven, Connecticut.
P. Russell Hardin, President, Robert W. Woodruff
Foundation, Joseph B. Whitehead Foundation,
Lettie Pate Evans Foundation and Lettie Pate
Whitehead Foundation, Atlanta, Georgia.
Eric T. Token, Senior vice President, Sales,
Marketing and Operations, Rose International,
St. Louis, Missouri.
Michael D. Hayford (chair), Executive
vice President and Chief Financial Officer, FIS,
Jacksonville, Florida.
2009 policyowners’ examining committee report
We were pleased to serve as members of the 2009 Policyowners’ Examining Committee, an
independent group representing nearly 3.5 million clients of Northwestern Mutual. In place since
1907, this unique committee structure reflects Northwestern Mutual’s heritage as The Policyowners’
Company. In conducting our work, we interacted with senior management, emerging leaders, and field
representatives. We also spent considerable time with Chairman and Chief Executive Officer Ed Zore
and new President John Schlifske. This report summarizes our observations and recommendations.
Many of us know northwestern Mutual the highest available ratings for insurance
as the preeminent life insurance company. financial strength from all four major rating
But more and more, northwestern Mutual’s agencies. northwestern Mutual’s enviable
clients turn to their financial representatives financial position made it possible for the
to provide expert guidance and the company to announce a 2010 dividend
company’s full range of insurance and payout of $4.7 billion, the second largest in
investment products to meet their financial the company’s history, despite the turbulent
security goals. we believe the company financial markets. we applaud management
is uniquely poised to capitalize on this for its long-term investment discipline and
opportunity and differentiate itself in the encourage the company to continue its
marketplace with its financial strength, commitment to cost control.
human capital, integrated financial security
strategy and its exclusive distribution system.
Human Capital
Because northwestern Mutual primarily
Financial Strength promotes its leaders from within, leadership
Mutuality, which allows the company to take development in both the home office and
a long-term view, served the policyowners well the network offices is a vital component
during a period of great economic turmoil. of the company’s future growth. we
throughout the financial crisis that began encourage the company to support local
in the fall of 2008, the company performed network offices by investing in front-line
admirably and today holds an unmatched management teams and identifying future
position of financial strength in its industry. leaders. at the home office, management has
acknowledged that operating efficiencies and
several factors contributed to the company’s leadership development can be supported by
resilience, including conservative underwriting performance-based compensation practices.
guidelines, sound investment practices and to enhance its competitiveness, the company
disciplined expense management. these must continue to build a performance culture
factors, together with a top-notch sales force that aligns compensation and other forms of
and an impressive policy renewal rate of recognition with individual and company-
96%, contributed to the company earning wide achievements.
17

18. Integrated Financial Security Distribution
we are impressed by northwestern Mutual’s northwestern Mutual’s exclusive distribution
ongoing evolution from an insurance company system of network offices and financial
to a provider of diversified financial products representatives is recognized as a competitive
and services. today, the company offers a advantage in the industry. the company is
spectrum of insurance and investment products executing its well-defined strategy for growth,
designed to provide clients with a foundation including the expansion of the number of
of risk management that allows them to save financial representatives and a focus on skill
for the future with confidence and to build, development and retention. progress is evidenced
preserve and distribute their wealth during by several initiatives, including a new contract
their lifetime and beyond. the integration of to stimulate field force growth, an incentive
the company’s product lines is evidenced by program to help new financial representatives
the reorganization of insurance and investment establish strong practices, added resources in
products areas under common leadership. network offices to support new representatives
and continued emphasis on the company’s
we find it ironic that a firm of northwestern award-winning college internship program.
Mutual’s quality is not more widely known.
each year, a small
group of policyowners
with requisite business
expertise assess our
operations on behalf of
their fellow policyowners.
as a company with the highest available we encourage the company to continue to
insurance financial strength ratings and partner with field management to build out
an unsurpassed reputation, the company their financial representative footprint. this is
should capitalize on its unique opportunity an appropriate investment designed to benefit
to increase market share, recruit top talent policyowners in the long run. the company
and grow brand recognition. the company’s should continue to hold field management
new marketing campaign emphasizes its accountable for results. as capacity builds in the
strength and consistency and is evolving field force, we encourage the company to leverage
northwestern Mutual from its identity as the this capacity to expand in underserved markets.
Quiet company. we encourage the company
to be more intentional about communicating
Conclusion
the integrated financial security message
in this time of economic uncertainty, the
internally and externally. the current economic
experience and conviction of northwestern
environment offers opportunity for the
Mutual’s leadership team is one of its greatest
company to distinguish itself and build
assets. during his tenure, ed Zore has led the
market share. we encourage the company
company’s evolution from a life insurance provider
to take advantage of this opportunity.
to a business that helps meet the overall financial
we note that the current regulatory climate security needs of people like us. He has done so
could impact northwestern Mutual’s business while holding firm to the founding principle of
model and financials. we are encouraged by mutuality and our best interests as policyowners.
the thoughtfulness and depth of the enterprise we applaud ed, John schlifske and the entire
risk assessment, scenario planning and risk senior management team on a smooth leadership
mitigation efforts. we feel that management is transition. John’s experience and knowledge of
taking appropriate steps to monitor legislative the company, together with his evident passion
developments and plan for adverse impacts. and vision for the future, leave us confident about
northwestern Mutual’s continued success.
18

19. NoRthweSteRN MutuAL subject to change. neither the existence nor mutual and its affiliated companies met
northwestern mutual helps clients protect the amount of a dividend is guaranteed on their needs. the personal financial needs
against financial risk and achieve financial any policy in any given policy year. some and results of the clients shown in this
security. the company, its subsidiaries policies may not receive any dividends in report may not reflect the experience of
and affiliates offer life, disability and a particular year or years even while other other clients. Please discuss your personal
long-term care insurance, investment policies receive dividends. In its 2010 financial situation with your northwestern
products, advisory services and trust dividend scale resolution, the board of mutual financial representative before
services that address client needs for trustees has exercised its discretion to purchasing any product or service.
financial protection, wealth accumulation, guarantee a minimum amount of dividends Please keep in mind that working
estate preservation and asset distribution. to be paid in 2010 to the policyholders with a northwestern mutual financial
Headquartered in milwaukee, Wisconsin, as a group. If this guaranteed amount representative or any other financial
the mutual company has more than exceeds the aggregate amount of dividends services provider is not a guarantee as to
3 million policyowners and expects to actually paid to individual policyholders future investment success.
continue as the leading u.s. company in in 2010, that excess will be paid out in
total individual life insurance dividends 2011 pursuant to the 2010 dividend
paid to policyowners. scale resolution. the presence of a For more information about northwestern mutual, please visit
guaranteed minimum amount in the www.northwesternmutual.com | about northwestern mutual
SuBSiDiARieS 2010 dividend scale resolution does
QuietCare® long-term care insurance is not obligate northwestern mutual
offered through northwestern long term to declare a dividend in future years or to
Care Insurance Company, milwaukee, guarantee any portion of dividends that eNteRpRiSe RiSK MANAgeMeNt
Wisconsin. strategic employee benefit may be declared in future years. northwestern mutual has a strong risk
services™ is a nationwide group marketing management culture that is vigilant in
program providing specialized services ANNuAL MeetiNg identifying and managing risks — whether
in the employee benefit arena. securities 8 A.M., MAy 26, 2010 financial, operational, strategic or
are offered through Northwestern Mutual the annual meeting of Policyowners of environmental — that could impact the
investment Services, LLC (NMiS), suite the northwestern mutual life Insurance strength and security of your company.
600, 611 e. Wisconsin ave., milwaukee, Company will be held at 8 a.m., Wednesday, We apply risk models, experience and
Wisconsin, 53202, 1-866-664-7737. may 26, 2010, at the company’s milwaukee judgment as part of a well-coordinated
nmIs, a registered investment adviser, campus, 720 e. Wisconsin ave., milwaukee, structure to identify, evaluate, address
broker-dealer and member of FInra and Wisconsin. the only item on the agenda and monitor current and emerging risks.
sIPC, is a wholly owned company for a vote is the election of trustees of this structure assures accountability for
of northwestern mutual. northwestern the company. scrutinizing risks, defining tolerance levels
mutual Wealth management Company, and managing risks within those levels.
a wholly owned company of northwestern hAve A queStioN?
Cross-functional senior management
mutual, is a limited purpose federal For policy inquiries or general information,
committees have been established to
savings bank authorized to offer a range see www.northwesternmutual.com.
review risks related to our business. they
of financial planning, trust, fiduciary, For billing and payment inquiries, call
are central to our internal system of
investment advisory and investment 1-800-388-8123. the company’s general
checks and balances. these committees
management products and services. phone number is (414) 271-1444.
work in partnership with the Chief
russell Investment Group is a Washington,
RepoRtiNg fRAuD risk officer, who facilitates consistent
usa, corporation, which operates
every year, insurance fraud costs direction and communication between
through subsidiaries worldwide and
companies and consumers billions of various risk management functions in
is a subsidiary of the northwestern
dollars. What can policyowners do to help the company and reports directly to the
mutual life Insurance Company.
the company’s anti-fraud efforts? the Chief executive officer. the company’s
company’s Web site has information board of trustees oversees all risk
MoRe ABout DiviDeNDS
on this topic. to report fraud, e-mail management efforts.
Decisions with respect to the determination
and allocation of divisible surplus are antifraud@northwesternmutual.com
as a financial security company, we
left to the discretion and sound business or call toll-free 1-877-607-2485.
believe that managing risks lies at the
judgment of the company’s board of heart of our business and is deeply
CLieNt-RepReSeNtAtive ReLAtioNShipS
trustees. there is no guaranteed specific rooted in the more than 150-year-old
this report contains profiles of certain
method or formula for the determination culture that guides our employees and
northwestern mutual clients, their personal
and allocation of divisible surplus. financial representatives.
financial needs and how northwestern
accordingly, the company’s approach is
19

20. strong— always
the northwestern Mutual business model is built to perform well both in
good times and bad. in 2009, our strength and consistency shone brightly
in a volatile time.
HIGHEST HIGHEST
$
4 .7 billion FORTuNE ®
financial strength CUSTOMER Most Admired
dividend payout RATINGS satisfaction
We expect to northwestern northwestern We have been named
pay more than mutual mutual leads the one of the World’s
$4.7 billion in maintained industry with the most admired
dividends to the highest highest customer life insurance
policyowners in available ratings satisfaction companies in
2010 — more for insurance score among Fortune® magazine’s
than twice the financial strength u.s. life insurers. march 16, 2009,
life insurance from all four — The American annual survey. the
dividends of our major rating Customer Satisfaction survey’s participating
closest competitor. agencies.* Index, fourth quarter executives, directors
2009 report
and analysts placed
the company first
in the attribute of
financial soundness.
VIeW our ClIent VIDeos onlIne:
northwesternmutual.com | about northwestern mutual | our Company | annual report
The Northwestern Mutual
Life Insurance Company • Milwaukee, WI
www.northwesternmutual.com
90-0073-01 (0310)
*Third-party ratings are subject to change.