Northwestern Mutual Life
Founded in 1857, Northwestern Mutual initially focused exclusively on life insurance policies. Over the years, they branched out into other areas, including disability income insurance and financial planning and investment products. The company entered the long-term care insurance market in the 1990s. Today, they continue to sell LTC insurance through their subsidiary, Northwestern Mutual Long-Term Care Insurance Company, and have become one of the largest long-term care insurance providers in the United States, with roughly 138,000 policies in effect as of 2014. In total, Northwestern Mutual serves over 4.4 million clients and expects to pay out a total of $5.3 billion in claims in 2018 alone. Northwestern’s status as a mutual company means that it is owned by its policyholders, allowing it to focus on service and meeting the needs of its customers.
Long-Term Care Insurance Policies
Northwestern Mutual offers a comprehensive list of plans and benefits along with features such as inflation protection. The only area where their policies fall a bit short in relation to those of other long-term care insurance companies is in terms of benefit periods. In addition to the range of benefits available today, Northwestern Mutual is committed to offering new policy features to existing policyholders whenever they can. It is also a company committed to steady, lasting value, and does its best to keep rates stable and avoid sudden increases. While Northwestern did have to raise their rates recently, the company had previously gone nearly two decades without any such price jumps for existing policies, something that is nearly unheard of in today’s long-term care insurance market.
Reputation and Financial Strength
One of the main draws of Northwestern Mutual is their outstanding financial strength and stability. This is reflected in the scores awarded to the company by the top independent rating agencies: A.M. Best gave them an A++ (superior), Standard & Poor’s an AA+ (very strong), Fitch an AAA (exceptionally strong), and Moody’s Investors Service an Aaa (exceptional). In every case, these ratings are the highest possible scores currently awarded to life insurance companies by these agencies. Ratings like these are important because a company’s financial strength helps to determine its ability to pay out future claims.
One of the factors that has gotten many other long-term care insurance companies into financial trouble in recent years is operating on the assumption that a large number of people will drop their policies and never actually file a claim – an assumption which, much to these companies’ misfortune, has been proven wrong. What helps to make Northwestern Mutual especially strong from a financial standpoint is the fact that it operates on the assumption that the vast majority of policyholders will keep their policies and will eventually file claims.
While some issues have been reported, Northwestern Mutual generally scores well with clients, too, and 96% choose to stay with the company for more than 1 year.
Be sure to take a look at our other articles to learn more about the various insurance companies offering long-term care policies. Remember – every policy and every company is different, and it pays to do your research and shop around.
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