Northwestern Mutual\'s 2008 Investment Report.

1. ov e r 1 50 y ea rs of
st r e n g t h sta b i l i t y
investment re p ort 2008

2. The Northwestern Mutual Advantage
As a mutual company, The Northwestern Mutual Life Insurance Company (Northwestern Mutual)
operates for the protection and benefit of its policyowners, with a singular focus on their best interests.
The company’s structure and business model allow for a long-term perspective and approach in its
product offerings, business operations and investment strategy.
Since its founding in 1857, Northwestern Mutual
has been guided by its core principles. The company
aims not to be the biggest but instead to be safe,
to value quality above quantity and to rank first
in benefits to policyowners rather than first in size.
Beyond mutuality, what distinguishes Northwestern Mutual? General Account
Portfolio Product Mix
■ Northwestern Mutual’s core financial products (depicted in graph to the
right) focus primarily on traditional insurance, rather than complex financial Percentage of general
account insurance reserves
products that may have risks more difficult to predict or manage.
■ Participating portfolio life insurance represents nearly three-quarters of
the company’s total premium revenue. This product is considered by rating
agencies to be the lowest-risk product in the life insurance industry.
■ Policyowners tend to remain with the company for many years, which
is illustrated by the company’s excellent persistency rate of 96.1%. In
addition, Northwestern Mutual’s underwriting expertise has enabled the
company to benefit from superior mortality experience. Together, these
factors translate into stable cash flow. Life Insurance 91%
■The company does not rely on debt financing or leverage to finance its Annuities 5%
operations or investment portfolio, reflecting Northwestern Mutual’s Disability and Long-Term Care
Insurance 4%
conservative approach to
Historical Surplus Ratio risk management.
Ratio of total surplus and AVR to general Another distinguishing feature is the company’s financial
account insurance reserves
strength as reflected in its total surplus and surplus ratio,
16%
which are two measures of an insurer’s ability to meet its
financial obligations. Total surplus was $13.4 billion at
14%
year-end 2008. Despite the decline in financial markets
12% during 2008, Northwestern Mutual’s surplus ratio
10% remains both sound, at 11.5%, and strong compared to
its historical surplus levels (as shown in chart to the left),
8%
as well as the capitalization standards established by the
6% rating agencies and insurance regulators.
4%
The factors that make Northwestern Mutual different —
2% its mutual structure, a focus on participating portfolio life insurance,
0% outstanding persistency, mortality and financial strength —
88 90 92 94 96 98 00 02 04 06 08 combine to make the company strong.

3. As a significant investor in fixed income and equity markets,
Northwestern Mutual was not immune to 2008’s market declines.
Despite these challenges, Northwestern Mutual remains financially sound
and is well positioned to fulfill the promises made to its policyowners, a testament
to the company’s highly diversified investment portfolio and historically high
capital levels at the beginning of 2008.
Last year was an unprecedented and difficult period for capital markets
and the economy. Global asset prices declined precipitously due largely
to unsustainably high levels of borrowing, unwise investment decisions
and weak risk management by some market participants. As highly
leveraged investors sold assets, housing prices declined and consumer
demand weakened, the U.S. economy entered a recession. Governments
around the world have intervened on a massive scale, but the near-term
economic outlook remains uncertain.
Northwestern Mutual’s strength is deeply rooted in its singular focus
on the mutual protection and benefit of its policyowners. Unlike many
others in the life insurance industry, we do not offer universal life
insurance with secondary guarantees, guaranteed investment contracts
or annuities with guaranteed living benefits. While other firms faced
difficulties in 2008 due to borrowing needs and market conditions, our steady flow of
revenues from insurance premiums and investment income totaled $21 billion in 2008,
providing more than $12 billion of cash flow for investing activities.
In 2008, Northwestern Mutual’s invested assets grew 2.6%, as investment and other
income more than offset capital losses. Highlighting our long-term financial strength,
dividend payments to participating policyowners in 2009 are expected to total
more than $4.5 billion, the third-largest dividend payout in the company’s history.
The 6.5% dividend interest rate on most unborrowed permanent life insurance funds
reflects our desire to provide policyowners with a very attractive return while
conservatively managing the company’s capital.
Looking back at the events of the last year, the concept of risk was central to market
developments. Managing risk – whether mortality risk, credit risk, or other risk –
has always been at the forefront of Northwestern Mutual’s business and investment
operations. We reassess risk on an ongoing basis to preserve and enhance the
company’s strength and stability.
We anticipate that difficult economic conditions could continue for a considerable
time, leading to volatile markets, increasing corporate defaults and other challenges
to our investment portfolio. In response, we have adopted a defensive approach in
our investment activities, reducing our exposure to equities and other higher-risk
assets. The company’s experienced investment team has built liquidity in order to
position the portfolio to weather a downturn of uncertain duration. As we enter
2009, be assured your company is financially strong and well positioned to build on
its 152-year-long track record of success.
Mark G. Doll
Chief Investment Officer

4. Investment Objective
Northwestern Mutual’s investment objective is Northwestern Mutual’s significant allocation
to generate superior risk-adjusted returns while to equity investments relative to fellow insurers
maintaining a well-balanced and diversified is a distinguishing component of the company’s
portfolio to preserve the company’s exceptional investment portfolio. The company’s mutual
financial strength. This time-tested strategy ownership structure, product mix, strong
fundamentally supports Northwestern Mutual’s persistency and mortality results, and solid surplus
ability to deliver lifelong financial security to its position enable it to maintain greater exposure to
policyowners and clients. equity investments than many of its competitors.
In 2008, worldwide equity markets declined
Northwestern Investment Management Company, significantly. Northwestern Mutual recognized the
LLC and Mason Street Advisors, LLC, both risk in the equity markets and reduced exposure
wholly owned subsidiaries of Northwestern Mutual, to these markets during the second half of the
invest the company’s $123 billion of managed year. By year-end, equities represented only 13%
assets in accordance with the company’s investment of managed assets. The company still believes that
guidelines. Consistent with Northwestern Mutual’s over a long period of time, equity investments
investment objective, the company invests should generate higher returns than fixed income
approximately 80% to 85% of managed assets securities, providing a distinct advantage to
in fixed income and the remaining 15% to 20% Northwestern Mutual policyowners.
of managed assets in equities.
Consistent with the company’s investment
Fixed income investments represent the core objectives, Northwestern Mutual may also enter
of Northwestern Mutual’s investment portfolio, into transactions that are designed to reduce the
providing a stable foundation for the overall company’s exposure to fluctuations in interest
portfolio while generating current income. rates, foreign currency exchange rates and market
Northwestern Mutual’s portfolio of fixed income volatility. These hedging strategies include the
investments is largely highly rated and is well- use of forwards, futures, options and swaps. In
diversified within and among fixed income sectors implementing its hedging strategies, the company
to minimize risk. closely manages and monitors counterparty risk,
utilizing minimum ratings requirements, maximum
Northwestern Mutual’s equity investments exposure limits, and collateral agreements, which
include investments in public common stock, require the counterparty to post collateral should
real estate and private equities. Typically, the market value exceed established thresholds.
such diversification across different types of
equities enables the company to offset weakness Ultimately, the combination of asset diversification,
in any one area with attractive performance active portfolio management and a long-term
in another. Furthermore, similar to fixed income, perspective supports outstanding product value
equity investments are highly diversified across and enhances the company’s financial strength.
countries, industries, company sizes and Northwestern Mutual’s prudent investment strategy
other parameters. and unique business model have contributed to
more than 150 years of strength and stability.

5. Managing Portfolio Risk in Volatile Markets
While Northwestern Mutual continues to invest with volatility and will ultimately enable it to capitalize
a long-term perspective, in times of severe market on attractive new investment opportunities across
disruptions it is prudent to consider near-term various markets when appropriate.
tactical measures. In response to the unprecedented
developments of 2008, the company has taken several In conjunction with increasing its holdings of higher
such steps. Combined with Northwestern Mutual’s quality, liquid investments, Northwestern Mutual
financial strength, these decisions are intended has reduced its holdings of higher risk assets,
to conservatively position the company to weather as shown below. Reduced holdings of equities and
even an extended period of difficult financial other more volatile assets will defensively position
market conditions. the company to prosper despite the potential
for extended near-term economic weakness.
Northwestern Mutual has increased its allocation While investing a significant portion of the portfolio
of investments to higher quality, liquid assets. in equities continues to be a key component of the
At year-end, Northwestern Mutual held more than company’s overall long-term strategy, its short-term
$25 billion in cash equivalents, U.S. Treasuries and actions are focused on reducing risk and guarding
government-guaranteed debt, representing 21% of against loss of principal to protect the health of the
total managed assets. This near-term reallocation overall portfolio.
should help insulate the company from market
Allocation to Higher Quality, Reduced Holdings of Higher Risk Assets
Liquid Assets
25% 25%
23.5%
$25.9 billion 20.0%
20%
$22.6 billion 20%
15% 15%
10% 10%
5% 5%
0% 0%
2007 2008 2007 2008
Cash, Treasuries and Government- 2007 2008
Guaranteed Debt as a Percentage
of Total Managed Assets Public and Private High Yield Debt 6.4% 6.8%
Real Estate Equities 5.4% 5.1%
2007 2008
18.7% 21.0% Private Equities 5.3% 5.0%
Public Equities 6.4% 3.1%
Total 23.5% 20.0%

6. Overall Results on Invested Assets
Northwestern Mutual’s total invested assets Investment earnings in 2008 included $7.8
increased nearly 3% to $136.6 billion in 2008, billion in net investment income, which was
due primarily to the continued investment of predominately comprised of interest payments
premiums, interest income and dividend income and dividends. Fixed income investments
— partially offset by realized and unrealized contributed 85% of net investment income,
capital losses. Over the course of the year, the while equity investments contributed the
company shifted its asset allocation in order to remainder, largely in line with each asset class’s
increase liquidity and reduce risk. Reflecting this allocation within the overall portfolio.
shift, cash and short-term investments increased
more than 68% to $4.2 billion, while fixed Realized capital losses in the portfolio
income assets grew approximately 5% to $106.4 included $1 billion of write downs for other-
billion and equity assets declined nearly 14% to than-temporary declines in value in 2008.
$16.6 billion. After taxes and required deferrals of interest-
related gains, net losses were $4.1 billion
Growth in fixed income assets primarily reflected and reduced the company’s surplus ratio to
a $1.2 billion, or 2%, increase in public bonds 11.5% at year-end 2008, compared to 14.5%
and preferred stock as well as a $1.3 billion, at year-end 2007. Despite the impact of these
or 6%, increase in private bonds and preferred losses, Northwestern Mutual’s healthy surplus
stock. Commercial mortgage whole loans ratio of 11.5% is higher than company surplus
increased more than $700 million, or 4%. ratios in all but 13 years of the company’s
152-year history.
Within the equity portfolio, public common
2
| stock assets declined 50% to $3.9 billion,
due to both lower market values and reduced
Investment performance in 2008 demonstrated
the benefits of Northwestern Mutual’s highly
allocation to equities. Real estate equities diversified investment portfolio and disciplined
declined 2% to $6.3 billion. Private equities, underwriting standards. The company
which include investments in certain had minimal exposure to investments in
subsidiaries, increased 27% to $6.4 billion. distressed financial institutions – losses related
This growth was due largely to an increase to investments in Lehman Brothers, AIG,
in the carrying value of the Russell Investment Fannie Mae (FNMA) and Washington Mutual
Group, Northwestern Mutual’s global were equal to approximately 0.2% of total
investment services subsidiary, which was invested assets.
previously carried at a negative value.
This new reporting basis, coupled with new Over the last 10 years, net investment income
investments, contributed to the $1.3 billion and total invested assets have exhibited strong
increase in private equities and more than and consistent growth, increasing at compound
offset a decline in market values. annual rates of 5% and 7%, respectively.
These results reflect Northwestern Mutual’s
commitment to its disciplined, time-tested
investment approach, which supports the
company’s outstanding dividend interest rate
and strong surplus position. ■

7. Total Assets
December 31, 2008 December 31, 2007
In Millions In Millions
Fixed Income Investments
Short-Term
Money Market Investments $4,213 $2,496
Long-Term*
Public Bonds and Preferred Stock 58,563 57,356
Private Bonds and Preferred Stock 23,410 22,069
Commercial Mortgage Whole Loans 20,259 19,546
Total Fixed Income Investments 106,445 101,467
Equity Investments
Real Estate 6,300 6,401
Public Common Stock 3,936 7,859
Private Equities** 6,360 5,020
Total Equity Investments 16,596 19,280
Total Managed Assets $123,041 $120,747
Loans on Policies 12,884 11,797
Other Investments 712 643
Total Invested Assets*** $136,637 $133,187
Other Assets
Separate Account Business
5,130
13,387
3,656
19,704 | 3
Total Assets $155,154 $156,547
* As of year-end 2008, Commercial Mortgage-backed Securities are included in “Public Bonds and Preferred
Stock.” As a result, $3.5 billion included in “Commercial Mortgage Loans” in the 2007 Investment Report
(now “Commercial Mortgage Whole Loans”) is now shown under “Public Bonds and Preferred Stock”
for purposes of this chart only. Similarly, mezzanine investments in corporate issuers are included in
“Private Bonds and Preferred Stock” at year-end 2008. As a result, $1.5 billion included in “Private Equities”
in the 2007 Investment Report is now shown under “Private Bonds and Preferred Stock.”
** As presented in this report, private equities include direct investment in certain subsidiaries and affiliates.
*** Includes investment income due and accrued of $1,498 million and $1,395 million in 2008 and 2007, respectively.
Note: Please read table above in conjunction with Reporting Considerations on page 12 of this publication.
Numbers in tables are rounded.
Total Managed Asset Growth in billions
$150
$125
$100
$75
$50
$25
$0
1999 2000
2000 2001
2 2002
2 2003
2 2004
2 2005
2 2006
2 2007
2 2008
2

8. Fixed Income Investments
Northwestern Mutual’s fixed income The fixed income portfolio is designed to
investments serve as the foundation of the provide liquidity and current income while
overall investment portfolio. Fixed income minimizing loss of principal. To that end,
assets include money market instruments, the portfolio is well-diversified and generally
public bonds and preferred stock, private invested in high-quality assets. Public bonds,
bonds and preferred stock and commercial preferred stock and money market instruments,
mortgage whole loans. The company’s which are considered to be the most liquid
allocation to fixed income assets increased fixed income assets in the portfolio, together
to 87% of total managed assets at year-end remain the largest component of the portfolio,
2008, from 84% of total managed assets comprising 59% of total fixed income assets
at year-end 2007, due in part to the decline in 2008. Private bonds and preferred stock
in value of equities in general as well as represented 22% and commercial mortgage
measures taken by the company to reduce whole loans represented 19% of total fixed
overall portfolio risk. income assets at year-end.
Composition of Fixed Income Portfolio
PERCENT/TOTAL
TYPE DETAIL
FIXED INCOME
Corporate 47% Corporate investments include bonds and other
4
| fixed income instruments issued by public and
private corporations in the U.S. and abroad.
Commercial Mortgage 19% Commercial mortgage whole loans include private
Whole Loans fixed income investments backed by individual
income-producing commercial properties.
Residential Mortgage- 15% Residential mortgage-backed securities include
backed Securities public fixed income investments backed by pools
of residential mortgages.
U.S. Gov’t. and Agencies 8% U.S. Government and agency securities include
fixed income investments issued or guaranteed by
the U.S. Government or affiliated agencies.
Money Market Investments 4% Money market investments include generally
short-term and highly liquid instruments, such
as bankers’ acceptances, commercial paper,
repurchase agreements and government bills.
Commercial Mortgage- 3% Commercial mortgage-backed securities include
backed Securities public fixed income investments backed by pools
of commercial mortgage loans.
Asset-backed Securities 2% Asset-backed securities include a variety of fixed
income securities backed by pools of different types
of financial assets, including credit card receivables,
auto loans and other assets.
Municipal/Other 2% Municipal/Other investments include a variety
of fixed income securities issued by U.S.
municipalities and other governmental entities.

9. Northwestern Mutual’s investments in Quality of Public and Private Bond and
public bonds, preferred stock and money Preferred Stock Investments*
market instruments are actively managed to
maximize returns while preserving a high
AAA 39%
level of safety, liquidity and diversification.
To manage portfolio risk, investments are AA 8%
broadly diversified by security type, including A 15%
corporates, residential mortgage-backed, BBB 27%
asset-backed and U.S. Government securities.
BB 5%
In 2008, the company increased its allocation
to U.S. Government securities and money B 4%
market instruments to enhance liquidity and CCC &
reduce volatility. At year-end, Northwestern Below 2%
Mutual held more than $25 billion in cash
equivalents, U.S. Treasuries and government-
guaranteed debt. Northwestern Mutual’s
investments in private bonds and preferred
stock provide further diversification to the investments – defined as the ability of the
company’s overall portfolio and often benefit issuer to timely pay interest and repay
from higher yields and more attractive terms principal – remained high. As of year-end
relative to public bonds. 2008, 39% of these investments held the
highest quality rating of AAA.* Investment
The credit quality of the company’s public
and private bond and preferred stock
grade securities – those rated BBB* or higher
– comprised 89% of the portfolio.
| 5
Total Fixed Income Portfolio
2007 2008
60%
50%
48% 47%
47
40%
30%
20%
19
19%19% 16%15%
16%15%
5
10% 6% 8% 3% 4% 4% 3% 3% 2% 1% 2%
6% 3 4 3% % %
0
Corporate Commercial Residential U.S. Gov’t Money Market Commercial Asset- Municipal/
Mortgage Mortgage- and Agencies Investments Mortgage- backed Other
Whole Loans backed backed Securities
Securities Securities
* Quality ratings pertain exclusively to public and private fixed income securities and omit commercial mortgage
whole loans. These ratings are based on the higher of the credit ratings from Standard & Poor’s, Moody’s or Fitch
Ratings when available, or internal rating evaluations when third-party ratings are not available.

10. Fixed Income Investments
continued
Northwestern Mutual’s investment in
commercial mortgage whole loans accounted
for 19% of fixed income investments at year-
end 2008. The company tempered its new
commitments to this asset class throughout
2008 as market liquidity virtually disappeared
and economic uncertainty increased.
Northwestern Mutual’s historical focus on
property selection, borrower quality and
disciplined underwriting continued.
Northwestern Mutual concentrates its mortgage
lending on fixed-rate permanent loans greater
than $15 million secured by income-producing
property. The company invests primarily in Commercial Mortgage Whole Loan
apartments, shopping centers, office buildings in Dallas, Texas
and industrial warehouses throughout the
Rosewood Court is a 19-story multi-
nation. Private transactions offer more control
over both property quality and choice of tenant Class-A office tower located on
borrowers than publicly traded commercial a high profile site in the Uptown district
mortgage-backed securities. This portfolio has of Dallas, Texas. This property secures
6
| historically produced attractive yields and low
delinquency and loss percentages. ■
a commercial mortgage whole loan
in Northwestern Mutual’s portfolio.
Commercial Mortgage
Commercial Mortgage Whole Loans by Region
Whole Loans by Class
West 36% Midwest 11%
Apartments 34% Industrial 12%
East 30% Other 1%
Office 26% Other 6%
South 22%
Retail 22%

11. Mortgage Investments Residential mortgage-backed securities
are generally highly liquid public bonds
Northwestern Mutual’s total exposure to backed by a standardized pool of residential
mortgage-related investments, including mortgages. The mortgage payments
public residential mortgage-backed securities from the individual loans within the
and commercial mortgage-backed securities pool are passed through for payment of
as well as commercial mortgage whole principal and interest to the bondholders.
loans, represented 37% of the fixed As of year-end, 85% of residential mortgage-
income portfolio at year-end. While all backed securities within the portfolio were
of these investments are related to real guaranteed by either the U.S. Government
estate, it is important to note that each or government-sponsored entities.
has unique qualities and attributes.
Commercial mortgage-backed securities
Commercial mortgage whole loans are fixed are publicly traded bonds secured by a
income investments originated in the private diversified pool of commercial mortgage
market directly with owners of commercial whole loans originated by third parties.
real estate. Northwestern Mutual originates These investments typically offer more
these investments through a network of liquidity than commercial mortgage whole
experienced professionals located in eight loans. Northwestern Mutual’s commercial
regional field offices throughout the country. mortgage-backed portfolio comprised 3%
These investments are directly secured by of fixed income assets and 2.5% of invested
apartments, office buildings, warehouses assets. Of these, 59% were rated AAA*,
or shopping centers. Commercial mortgage with 84% rated A* or better as of year-end.
whole loans are considered illiquid because
of the unique attributes of the underlying
| 7
property securing each loan.
$39.6 billion $39.5 billion
100%
Percent of Total Mortgage
Investments by Type
80%
2007 2008
60% Commercial Mortgage
Whole Loans 49% 51%
Residential Mortgage-
40%
backed Securities 40% 40%
Commercial Mortgage-
20% backed Securities 11% 9%
0%
2007 2008
* Quality ratings based on the higher of the credit ratings from Standard & Poor’s, Moody’s or Fitch Ratings when
available, or internal rating evaluations when third party-ratings are not available.

12. Equity Investments
Equity investments are a distinguishing of 2008, Northwestern Mutual reduced
element of Northwestern Mutual’s investment its holdings of public common stock.
portfolio. The company’s equity portfolio is Furthermore, in an effort to lower the
broadly diversified across different types of common stock portfolio’s risk profile, the
equity investments, including public common company increased its allocation to domestic
stock, private equity and real estate. In 2008, large capitalization companies and lowered
this portfolio represented 13% of total its allocation to foreign companies.
managed assets, down from 16% in 2007.
This overall decline reflects both a shift toward Private equity investments accounted
lower risk fixed income investments and a for 38% or $6.4 billion of total equity
reduction in market values. investments at year-end. The private equity
portfolio includes mezzanine and equity
While Northwestern Mutual’s equity investments in buyouts of companies,
investments declined in value in 2008, over private equity and venture capital limited
the long term the company expects equities to partnerships and direct investments in
contribute both higher risk-adjusted returns selected other companies and subsidiaries.
and provide incremental diversification to the Northwestern Mutual’s private equity
overall portfolio. Over time, the company’s investments offer an additional potential
significant allocation to equities has enhanced source of attractive returns, primarily in
Northwestern Mutual’s dividend payment the form of capital gains. Additionally, these
history and financial strength. assets generally exhibit lower volatility than
their public market counterparts and provide
8
| At year-end 2008, the public common stock
portfolio totaled $3.9 billion, or 24% of
diversification benefits. Northwestern Mutual’s
long-term investment horizon allows the
the total equity portfolio. The public equity company to hold significant investments in
portfolio includes investments in domestic this asset class.
large, medium and small capitalization
companies, as well as in foreign companies. Despite the challenging private equity
Risk is well-diversified by company size, investing environment experienced in 2008,
industry and country. During the course Northwestern Mutual remains committed to
$7.9 billion $3.9 billion
Diversification of 100%
Public Common Stocks
80%
2007 2008 60%
Domestic Large-Cap 57% 59%
Foreign 26% 24%
40%
Domestic Mid-Cap 9% 11%
Domestic Small-Cap 8% 6%
20%
0%
2007 2008

13. the private equity markets and to the firms warehouse and office properties held through
with whom it has developed long-standing both direct and joint venture ownership.
relationships. The company believes that Through partnerships with developers
investing in fundamentally strong businesses nationwide, Northwestern Mutual develops
alongside leading private equity sponsors apartment communities and warehouse
provides an additional level of diversification properties and also purchases properties
and the opportunity for attractive returns. directly. Asset managers, operating out of
our real estate field offices, monitor local
Another facet of the company’s equity markets and actively manage the investment
portfolio is commercial real estate equity properties, creating additional long-term
investments, which represented 38% or value. The company also invests in private
$6.3 billion of the total equity portfolio real estate funds and public real estate
at year-end 2008. The real estate equity investment trusts (REITs), providing further
portfolio consists primarily of apartment, diversification within the equity account. ■
| 9
$19.3 billion $16.6 billion
Diversification of Equities 100%
80%
2007 2008 60%
Private Equities 26% 38%
Real Estate 33% 38%
40%
Public Common Stock 41% 24%
20%
0%
2007 2008

14. Northwestern Mutual
Investment Operations
Mason Street Advisors, a federally
Northwestern Mutual’s $123 billion managed registered investment advisor, is
assets portfolio is overseen by an experienced responsible for managing the public
team of investment professionals, working fixed income, preferred stock and
together to achieve the company’s investment common stock investments in
objectives. The investment team is led by the Northwestern Mutual’s portfolio.
following senior executives. Mason Street Advisors maintains
a disciplined investment process
that emphasizes rigorous research
Mark G. Doll and macroeconomic foresight. With
Senior Vice President an average of more than 18 years
& Chief Investment Officer of institutional knowledge and
David D. Clark experience, Mason Street Advisors’
Senior Vice President team of 56 investment professionals
(Real Estate)
bring maturity, consistency and
Jeffrey J. Lueken continuity to the management of
Senior Vice President public market holdings within
(Private Markets)
Northwestern Mutual’s portfolio.
10
| Jefferson V. DeAngelis
Vice President
Jefferson V. DeAngelis
(Public Markets)
President
Gary M. Hewitt
Vice President Patricia L. Van Kampen Christopher P. Swain
(Investment Risk Management) Managing Director Managing Director
(Common Stock) (Public Fixed Income)
Thomas A. Carroll Michael R. Buchholz
The company’s investment portfolio includes Managing Director Managing Director
fixed income, equity and real estate (Common Stock) (Public Fixed Income)
investments. Investment strategy and Jill M. Grueninger Dennis E. Korjenek
portfolio management are executed by teams Managing Director Managing Director
(Common Stock) (Public Fixed Income)
of investment professionals within Mason
Street Advisors, LLC (Mason Street Advisors) David R. Keuler Jason Steigman
Managing Director Managing Director
and Northwestern Investment Management (Common Stock) (Public Fixed Income)
Company, LLC (NIMCO), both wholly owned
William R. Walker Steven P. Swanson
subsidiaries of The Northwestern Mutual Life Managing Director Managing Director
Insurance Company. NIMCO is comprised (Common Stock) (Public Fixed Income)
of Northwestern Mutual Capital, which
manages privately held debt and equity
investments, and Northwestern Mutual
Real Estate, which manages commercial
real estate-related investments.

15. Northwestern Mutual Capital Jeffrey J. Lueken Mark E. Kishler
Senior Vice President Managing Director
With offices in Milwaukee and London and a staff (Private Debt & Equity)
of over 30 investment professionals, Northwestern Jerome R. Baier
Managing Director Randal R. Ralph
Mutual Capital invests globally, in North America, (Energy and Public Managing Director
Europe, Australia and Asia. The company manages Convertible Securities) (Private Equity Funds)
a diversified portfolio that includes private fixed
David A. Barras Howard Stern
income investments, mezzanine investments and equity Managing Director Managing Director
co-investments in private equity transactions, private (Private Debt & Equity) (Private Debt & Equity)
equity funds and convertible securities. With decades Timothy S. Collins Richard A. Strait
of experience as an investor in the private capital Managing Director Managing Director
markets, Northwestern Mutual Capital serves as a (Private Debt & Equity) (Private Equity Funds
and Private Debt
committed, trusted source of capital for corporations & Equity)
and financial sponsors worldwide.
| 11
Northwestern Mutual Real Estate David D. Clark
Senior Vice President
Northwestern Mutual is one of the largest real
Michael P. Cusick
estate investors in the nation, with investments Managing Director
in commercial mortgage loans, equities and (Mortgage Loan
securitized investments across all major property Production West)
types. Northwestern Mutual is a trusted financing Gregory Walz
source with more than 70 experienced investment Managing Director
professionals who provide quick, decisive action (Mortgage Loan
Production East)
and flexible, creative solutions. Origination,
underwriting and servicing are enhanced by having Thomas D. Zale
Managing Director
real estate professionals in eight regional field offices (Real Estate Equities)
familiar with local markets, borrowers and investors.

16. Reporting Considerations
Northwestern Mutual publishes its Investment Report annually to provide information
on the asset mix of its portfolio and the investment results generated during the
previous calendar year. Certain types of investments have been grouped differently
for this report than in Northwestern Mutual’s Consolidated Financial Statements
(CFS). The most significant of these differences as of December 31, 2008 are:
“Other investments” of $9.2 billion reported in the CFS includes subsidiaries and
affiliates, joint ventures, and partnerships. This report classifies these investments
based on the character of the underlying assets, including investments in private
equities, real estate, and public common stock of $4.4 billion, $2.8 billion and $0.4
billion, respectively.
Mortgage loans of $21.7 billion reported in the CFS includes $1.7 billion of loans
made to real estate joint ventures in which the company is an equity investor.
This report classifies these assets as real estate investments.
Due and accrued investment income of $1.5 billion reported separately in the CFS
is included in the respective asset classes to which the amounts due relate in
this report. Total assets, investment income and capital gains in this report are
consistent with the company’s CFS. The notes to the CFS provide further details as
to the accounting and valuation methods applied to the reported investment values.
PricewaterhouseCoopers LLP is the company’s independent accountant.
In respect to comments pertaining to the company’s year-end 2008 surplus total
of $13.4 billion and surplus ratio of 11.5%, these figures included the effect of two
permitted accounting practices. The first allowed the company to reflect some of the
substantial value of Russell Investments, its global investment services subsidiary.
The second change related to the treatment of deferred tax assets affected by
investments that suffered market declines in 2008. Without the permitted practices,
the company’s total surplus would have been $11.8 billion and its total surplus
12
| ratio would have been 10.1%, higher than company surplus ratios in all but 13
of the company’s 152-year history. ‘Total surplus,’ as cited in this report, is the
combination of surplus and asset valuation reserve (AVR).
In respect to comments pertaining to Northwestern Mutual’s dividend payout
and dividend scale interest rate, decisions with respect to the determination and
allocation of divisible surplus are left to the discretion and sound business judgment
of the company’s Board of Trustees. There is no guaranteed specific method or
formula for the determination and allocation of divisible surplus. Accordingly, the
company’s approach is subject to change. Neither the existence nor the amount of
a dividend is guaranteed on any policy in any given policy year. Some policies may
not receive any dividends in a particular year or years even while other policies
receive dividends. In its 2009 dividend scale resolution, the Board of Trustees has
exercised its discretion to guarantee a minimum amount of dividends to be paid
in 2009 to the policyhoders as a group. If this guaranteed amount exceeds the
aggregate amount of dividends actually paid to individual policyholders in 2009,
that excess will be paid out in 2010 pursuant to the 2009 dividend scale resolution.
The presence of a guaranteed minimum amount in the 2009 dividend scale resolution
does not obligate Northwestern Mutual to declare a dividend in future years or to
guarantee any portion of dividends that may be declared in future years.
A copy of Northwestern Mutual’s Consolidated Financial Statement is available on the
company’s web site – www.nmfn.com, or by written request to: Northwestern Mutual,
Corporate and Policyowner Relations, N04, 720 E. Wisconsin Ave., Milwaukee, WI
53202.

17. Financial Strength Ratings*
The Northwestern Mutual Life Insurance Company has
among the highest ratings in the life insurance industry from
the four major rating agencies: Standard & Poor’s, Moody’s
Investors Service, Fitch Ratings and A.M. Best.
*Ratings are subject to change. Third-party ratings are a measure
of a company’s relative financial strength and security but are not
a reflection of the performance of stability of funds invested in a
company’s separate accounts.

18. As a mutual company, Northwestern Mutual
has no shareholders. The company’s mutual structure
allows it to focus solely and directly on serving
the best interests of its policyowners and clients.
The company’s vision and values are echoed
in a statement made by its Executive Committee
and printed in the company’s
1888 Annual Report to Policyowners.
“The ambition of the Northwestern has been less to be
large than to be safe: its aim is to rank first in benefits to
policyowners rather than first in size. Valuing quality above
quantity, it has preferred to secure its business under certain
salutary restrictions and limitations rather than write a much
larger business at the possible sacrifice of those valuable
points which have made the Northwestern preeminently
the policyowner’s company.”
– 1888 Executive Committee
The Northwestern Mutual
Life Insurance Company • Milwaukee, WI
www.northwesternmutual.com
19-1205 (0309)