Northwestern Mutual posts record annual revenue

At some point a series of records becomes something more - a trend.

That has been Northwestern Mutual CFO Todd Jones's message to employees after the 166-year-old Milwaukee company posted record revenue of $35 billion in 2022, a 3% increase from the previous year.

"From the standpoint 2021, we called it, at the time, our best financial year in company history. And I think what I'm most proud of in 2022, is that now we're talking about back to back exceptional years," Jones said. "A record year is a record year, but when you have multiple years it's a trend and obviously this is a great trend for us to be on."

The Milwaukee-based insurance and financial-services company also set records for its year-end surplus, annual life-insurance sales, and annual dividend payment to shareholders. That it did so in a year of tumult — war in Ukraine, soaring inflation and the biggest stock market downturn since 2008 — is a testament to Northwestern Mutual's financial strength and customer connections in its life insurance and wealth management business, CEO John Schlifske said.

"This past year we again achieved remarkable milestones as acompany, all while managing through historic economic and market headwinds," Schlifske said. "Just as important, we continued to empower our clients to confront uncertainty with confidence, through a comprehensive planning experience, guided by our trusted financial advisors, and backed by the unsurpassed product value and strength of the company."

The company will pay $6.8 billion in dividends to shareholders this year.

It also retained its top rating from the four largest rating agencies – A.M. Best, Fitch Ratings, S&P Global Ratings and Moody's. Northwestern Mutual one of only six companies across all industries to carry an AAA rating from Moody's.

The company ended 2022 with a surplus of more than $37 billion. That's reserve cash above and beyond what the company needs to have on hand to be able to honor its life insurance commitments.

"That's really how we demonstrate financial strength to our policy owners," Jones said. "We're making promises 40 years into the future with a life insurance contract, so having that financial strength is really important for our policy holders."

The company closed the year with permanent life insurance sales of nearly $1.1 billion, the most ever, and collected almost $1.5 billion in life insurance premiums. As a result, Northwestern Mutual not only maintained its top ranking in the industry for individual life insurance sales, but also increased its market share. It now has more than 5 million customers across its life insurance, disability insurance, long-term care insurance, annuities and wealth management businesses.

The wealth management segment saw significant growth in 2022, posting its second-highest annual net cash inflow of nearly $22 billion, bringing it to a total of $227 billion in client assets.

The company has invested in recruiting and developing new advisors, and bolstering leadership and support for its independent wealth management advisor firms. It finished 2022 with 7,499 full-time financial professionals across the country, a workforce that the company called the largest and most diverse group in its history. The company also brought in more than 250 interns in 2022, a 40% increase from 2021, who are seen as a key to developing a next generation of talent.

A plan to renovate the company's 18-story office building at 818 E. Mason St. to mirror its 32-story office tower on Wisconsin Avenue and bring 2,000 employees now working in Franklin to the Milwaukee campus reflects the company's commitment to investing in its employees, Jones said.

"We're positioned really well for 2023 and beyond," Jones said. "We were not just trying to survive year after year, we're trying to thrive and remain on the offense. So we're investing in our future, our advisors, our customer experience, our planning experience, our people who we think are really a differentiator. I think everything's really clicking on all cylinders right now and we're really excited about the future."