Northwestern Mutual Annual report 2005

1. 2005 annual report
turning points

2. 2005
edward j. zore
President and Chief Executive Officer
the president and ceo
In ways both financial and operational, 2005 was a fine year for your company.
Northwestern Mutual responded to the rapidly changing environment with very
favorable fundamentals and heightened efficiencies. In so doing, we posted some of
the strongest financial results in our 149-year history.
Our successful year began, as always, with our primary objective — to create value
for ourclientsandpolicyownersbyadheringtoourcorecompetencies:well-designed
products, disciplined assessment of insurance risk, a balanced investment strategy,
and rigorous management of expenses.
Our strong performance in all of these areas allowed us to approve our largest divi-
dend in history for 2006. We expect to pay out $4.3 billion this year, with a dividend
interest rate of 7.5% on most unborrowed funds. Meanwhile, our surplus position
also reached an all-time high. We are very proud of delivering these results in the
continued low interest rate environment. We believe these results offer a tangible
demonstration of our belief in doing the right thing for the people we protect.
While life insurance sales were slightly above the industry average, total product
sales were stronger. For example,
> Individual disability income insurance new premium increased 5% to $44 million.
> New premium in our long-term care insurance line grew 15% to $22 million.
In addition, sales of investment products and services were excellent in 2005.
> Annuity total premiums and deposits increased 26% to $997 million.
Sales of mutual funds by representatives registered with Northwestern Mutual
Investment Services, LLC, were $6.3 billion, a 12% increase over 2004.
We also maintained the highest available ratings for financial strength from the four
major rating agencies. And we’re proud of being recognized as America’s “Most
Admired”company in our category for the 23rd
time in 2006 by Fortune®
Magazine.

3. 2005 2004 Change
Policyowner dividends $4,269 $3,880 +10%
Policyowner benefits paid $4,577 $4,487 +2%
Individual life insurance in force $930,468 $869,542 +7%
Total assets $133,057 $123,957 +7%
Total surplus asset valuation reserve $12,910 $11,490 +12%
Results in Brief (in millions)
1
Looking to the future, we’re working hard to ensure that our product offerings will
keep pace with you and your needs. Last year, the company rolled out new products
and new features in its life insurance and annuity lines — all designed to meet the
needs of individuals and families at various life stages. We will continue to bring to
market more new options in the future.
As good as our results were in 2005, we don’t simply measure our performance in
numbers. We are in business to serve you, your families, and your businesses. In this
year’s Annual Report, you’ll meet several families and read about difficult turning
points in their lives. Their stories — from the struggle of living with an incurable
disease to the sudden loss of a spouse at a young age — are told from the viewpoints
of both the beneficiaries and our financial representatives who serve them.
In these short slices of life, you’ll see how Northwestern Mutual and its financial
representatives helped make a difference — a difference that gave these individuals
the freedom to make the best choices for their families.
Stories like these represent the essence of Northwestern Mutual. We aim to make a
difference in people’s lives; we help them work toward financial security; and we
work with them to prepare for consequences of the unexpected.
This is our promise and our privilege.
edward j. zore | President and Chief Executive Officer
February 1, 2006
on the cover: Policyowner Leah Marks of Hercules, California. Meet her on the
next page. inside: Read about powerful turning points in the lives of several
policyowners and how Northwestern Mutual helped them in times of need.

4. policyowners leah marks and son, jordan
hercules, california
turning points
keeping promises in times of need
Leah Marks has a message for anyone who puts off plan-
ning for life’s uncertainties. “My husband was just 42 when he died,” she said. “You
have to be prepared for the unthinkable.” Last year Leah became a widow with a
teenage son when her husband, Kevin, died of cancer. Leah couldn’t imagine life
without him. “I never thought I would lose him so soon,” she said. “In life, anything
can happen at any age.”
Years before, the couple had purchased a Northwestern Mutual life insurance policy
from Financial Representative Amy Corbett. The death benefits from that policy
were the core of Leah’s assets after Kevin’s death.
“Right after we bought the policy, it was hard to manage the premium payments,
but I’m glad we did. They were just as important as our mortgage,” Leah said.
“Life insurance is really the most important thing you can do for your family.”
Leah can’t stress enough the importance of her relationship with Amy Corbett.
“People perceive their relationship with an agent as strictly a business relationship,
but they should make sure the person they work with is someone they feel good
about, someone who’s knowledgeable and who cares about them,” she said. Amy
Corbett continues to be an important person in Leah Marks’ life. Recently, Leah
worked with Amy on preparing for the next phase of her and son Jordan’s lives.
Leah opened investment accounts with Northwestern Mutual Investment Services
and made sure both she and Jordan have life insurance coverage.
Soon Jordan will head to college. Leah takes comfort in knowing that she has funds
to cover the cost of his education. She also has the financial means to stay in the
family’s San Francisco Bay area home and take the time she needs to make impor-
tant decisions about her future; that gives her strength during a difficult time.
2

5. financial representative
amy corbett, clu
san francisco, california
One year since her husband’s death, Leah Marks believes
that Amy Corbett has done much to earn her enduring trust. Leah paid her financial
representative the highest compliment at Kevin’s funeral service, attended by hun-
dreds of friends and family members who came to pay their respects. She embraced
Amy and told her, “Because of all you’ve done and all the support you’ve given me,
you’re the most important person here to me today.”
Amy knows how essential good relationships are in life. Her relationship with the
Marks family gave the San Francisco-based financial representative a stronger sense
of conviction and purpose in the work that has been her career for nearly 10 years.
Having a client die of a terminal illness in the prime of his life and leave behind a
wife and teenage son was a turning point for her.
“After what happened to Leah and Kevin Marks, I know that when I meet people
who are underinsured or uninsured, I feel a deep personal responsibility to help them
get the financial security they need,” said Amy. “If previously I had any hesitation
or felt that I was bothering someone when I approached them about the need for
life insurance — that’s gone — because I have seen the power and importance of
what I do for people.”
For Amy, her association with Northwestern Mutual is a critical part of what she
brings to people. She values her affiliation with a company that has best-in-class
products and a reputation for putting its customers’ needs first.
“What my clients share with me about their lives, their hopes and their dreams is
really an honor. I have to live up to their trust,” said Amy. “I want to bring the people
I serve the best products available from a company that offers great value and has
a reputation for integrity.”

6. policyowners barry and chris erickson
overland park, kansas
Three years ago Barry Erickson had a backache that
wouldn’t go away. At the same time he and his wife, Chris, noticed that he was
shuffling his feet when he walked. He also had trouble writing. Those mysterious
symptoms were enough to send him to the doctor.
After medical testing, the Ericksons were told that Barry had Parkinson’s disease,
devastating news to the parents of five daughters. For two more years, Barry contin-
ued his career as general manager of an import car dealership in suburban Kansas
City before progression of the disease made it impossible for him to keep working.
For more than a year now, Northwestern Mutual disability insurance benefits have
been arriving monthly. The benefits replace much of the income Barry lost and, he
said, have made a huge difference in the family’s financial health. Two life insurance
policies remain in force because Barry had a waiver of premium benefit, so North-
western Mutual began picking up the cost of premiums when he became disabled.
“Barry was just 50,” said Chris. “He was entering his peak earning years when this
disease struck. These were going to be the years when we saved the most for our
retirement.” Chris, who worked part-time before taking a leave last year to care for
Barry, added, “If we hadn’t had this coverage, we would have had to sell everything
immediately, including our home. This would have wiped us out financially.”
“Allofthepeoplewe’veworkedwithatNorthwesternMutualhavebeensocompas-
sionatethroughthis,andtheymadetheclaimsprocessaseasyastheycould,knowing
it’s a very difficult time for us,” said Chris. “The help they’ve given us has provided
incredible peace of mind as we make our way through this one day at a time.”
4

7. Discussing long-term disability and the need for disability
insurance isn’t awkward or difficult for Financial Representative Jeff Imlay. The
most important part of his job is assessing the needs of his clients, educating them
about options, and providing them with the solutions that protect them.
“People understand the need for this coverage. But, even though they generally have
good intentions, they don’t always follow through and financially protect them-
selves against a disability that would prevent them from working and earning an
income. That’s the part that is difficult.”
It’s also a decision he’s seen many people postpone. Often, it’s because they have
difficulty imagining that a disability could ever happen to them.
Then there are clients like Barry and Chris Erickson, who took prudent action to
ensure their family’s future was secure.
“I feel good about that because the disability policy I recommended to Barry and
Chris is now providing important benefits that give their family some peace of mind
and financial security,” said Jeff. “Disability insurance helps people keep things
together and be able to focus their attention on taking care of themselves and their
loved ones at a time when that is what’s most important.”
While the emotional and physical toll of living with a rapidly progressing case of
an incurable disease has been difficult to bear, both Barry and Chris appreciate the
many hours Jeff Imlay spent helping them prepare for what the future holds.
Though situations such as the Ericksons’ are very difficult, it is at least satisfying for
Jeff to see his work have a positive impact during a trying time. “This family gets a
check every month. To see Northwestern Mutual make good on its promise and to
know that I was a part of that is very rewarding.”
financial representative
jeff imlay
overland park, kansas

8. policyowner stacey stone
bellmore, new york
StaceyStone• It was always important for Lonny Stone to know that his
wife, Stacey, and their two sons would be taken care of financially if he died young.
When Lonny bought Northwestern Mutual life insurance coverage on himself from
Financial Representative Ian Freeman, “He was trying to do the right thing for me
and the kids,” said Stacey. “And he sure did. Raising kids is expensive. He wanted
to be sure that if anything ever happened to him, the boys and I would be able to
remain in our house and I would be able to stay home and raise them.”
Lonny was healthy and strong, in the prime of his life. In early 2001 he had started
his dream job as an operations manager for a commodities brokerage. Then it all
changed in an instant when he died at work in the September 11th
terrorist attacks
on the World Trade Center. Like so many others, the Stone family’s life was changed
forever that day.
For Stacey, a stay-at-home mom, and her two sons, now 13 and 16, what happened
that day was unimaginable. Today Stacey recalls that her husband always had his
family’s best interests in mind. With his professional background in finance, Lonny
was quick to take on the role of managing the family’s finances and making sure
they were prepared for the future.
Having the death benefit from the Northwestern Mutual policy gave Stacey some
peace of mind right after Lonny’s death. “I was able to focus on my children and
everything that was happening to my family. That was the most important thing.”
In the 4½ years since Lonny’s death, Ian Freeman has maintained a close connection
to the family and Stacey values their ongoing relationship. “He’s smart, and I respect
him. He’s done a wonderful job for my family.”
6

9. financial representative
ian freeman, clu, chfc
waterbury, connecticut
Financial Representative Ian Freeman and his client
Lonny Stone had talked many times about the unpredictable nature of life. Both
agreed that it was important for the Stone family to protect against the risk of the
unknown and unexpected. Ian strongly recommended that Lonny buy life insurance
coverage to provide a base of financial protection so that his family’s future would
be secure no matter what happened. Lonny took Ian’s recommendation to heart.
WhenIancalledLonny’swife,Stacey,intheaftermathofSeptember11th
,hepromised
her he would do whatever he could do to help. Benefits from Lonny’s life insurance
policy arrived from Northwestern Mutual within days, giving Stacey the money she
would need both immediately and further into the future.
But Ian Freeman’s relationship with the family didn’t stop when the death benefit
was paid. For more than two years, he checked in on Stacey and the boys with
regular calls and periodic visits just to make sure they were OK and to let them
know he cared.
Ian helped Stacey with many decisions in the days, months and years that followed.
Today, he still calls Stacey regularly just to see how she and the boys are doing and
to ask if he can help in any way.
“I told her after Lonny’s death that I would be there and I will live up to that promise.
This is the value of what we do as financial representatives. It’s not about delivering
a check, it’s about delivering on a promise to help people through the difficult times.
The money is only the beginning of that promise.”
In Ian’s view, “I have an enormous opportunity and a tremendous responsibility to
help people. The most rewarding part of the job for me is the relationships I build
with people and the knowledge that I’ve provided them with real value. When I see
they have peace of mind, it’s all that matters. This is a truly humbling business.”

10. news 8
more news
Industry Leader
NorthwesternMutualmaintainedthehighestavailableratingsforfinancialstrength
from all four major rating agencies: Standard Poor’s, A.M. Best, FitchRatings
and Moody’s Investors Service.
The company again expects to lead the U.S. industry in total individual life insur-
ance dividends paid to policyowners, with a dividend payout expected to be $4.3
billion in 2006.
The company rated high in a key indicator of customer satisfaction with a policy
persistency rate of 96.4% for life insurance in-force, a level expected to remain
among the highest in the industry.
Accolades
A FORTUNE®
Magazine survey ranked Northwestern Mutual the most admired
company in its category in the U.S. for the 23rd
time (February 2006) and in the
FORTUNE®
global survey for the 7th
time (March 2006).
Northwestern Mutual earned the highest customer satisfaction score among U.S.
life insurers in the University of Michigan’s American Customer Satisfaction Index
survey for 2005 (February 2006).
Selling Power magazine recognized Northwestern Mutual as one of the “50 Best
Companies to Sell For” in the U.S. (December 2005).
Vault, Inc. ranked Northwestern Mutual’s internship program among the Top Ten
Internships in the U.S. in 2006 (January 2006).
Products and Services Highlights
Total insurance premium revenue increased to $11.4 billion, up more than 6%.
Annuity premiums and deposits totaled $997 million, a 26% increase over 2004.
Annuity sales reached record levels as the company introduced several new annuity
features to better serve clients’ needs.
Total sales of mutual funds through the Northwestern Mutual Financial Network
were $6.3 billion, a 12% increase over 2004.
Russell Investment Group’s assets under management grew to $155 billion,
19% above the previous year’s results. The Russell Investment Group, affiliated
companies of Northwestern Mutual, provides investment management and ad-
visory services.
The Northwestern Mutual Trust Company was renamed and re-branded to better
reflect the range of products and services it provides; it is now the Northwestern
Mutual Wealth Management Company, a Registered Investment Adviser.

11. Northwestern Mutual’s primary financial goal remains unchanged: to pay a level
of dividends that delivers the highest product value to policyowners, without
compromising superior financial strength.
Policyowner value
A participating policy’s ultimate value depends in large part on dividends paid to
policyowners, which reflect the company’s underlying investment performance,
claims experience and expense management. Dividends payable to policyowners
during 2006 are expected to be $4.3 billion, an increase of 9% from the previous
year. This includes a 7.5% dividend interest rate to be credited on most unborrowed
life insurance funds,unchanged from 2005 despite continued low market interest
rates, and a 31% increase in disability income dividends.
Superior product value contributes to policyowner satisfaction and loyalty. The com-
pany’s overall persistency for life insurance in-force of over 96% is expected to remain
among the best in the industry. More than 75% of life insurance dividends paid in
2005 were used by policyowners to purchase additional insurance protection, help-
ing increase total life insurance in-force by 7% to $930 billion at year-end 2005.
Operating Results
Premium revenue increased 6% to $11.4 billion, including growth in each of life,
disability income, long-term care and annuity premiums. Net investment income
of $6.5 billion grew 7%, reflecting higher dividends from diversified investments in
real estate, energy, and other partnerships and joint ventures, while maintaining
the strong credit quality of the company’s bond and mortgage portfolios.
2005financialresults
2005 financial results
9

12. Total policy benefits, including additions to reserves for future benefits, increased
5% in 2005. This included $4.6 billion of benefits paid to policyowners or their
beneficiaries. Mortality experience remained very favorable, a reflection of the com-
pany’s careful underwriting practices. Disability claim experience improved for the
fifth consecutive year. Expenses to operate the home office rose only 4%, in part
a reflection of the company’s ongoing commitment to efficiency and cost control.
After provision for dividends to policyowners, net gain from operations of $614
million declined from $723 million in the prior year,due primarily to nonrecurring tax
benefits in 2004. Net income,which includes net realized capital gains,increased
to $924 million in 2005 from $817 million.
Investment portfolios
The investment climate was mixed in 2005. Low market interest rates, a flat yield
curve and credit issues in the auto and airline sectors made fixed income invest-
ing a challenge, while major U.S. equity market indices advanced modestly for the
year. In addition to solid 7% growth in net investment income, the company’s
investment portfolios generated $1.1 billion in net realized and unrealized capital
gains (before taxes and deferrals) in 2005. These gains were primarily attributable
to common stock investments, including very attractive returns in the company’s
international equity portfolio.
The bond portfolio of public and private debt remains high quality, with 92% rated
as investment grade. The portfolio is well diversified, which limits the exposure
to credit loss from any single industry or issuer. Short-term investments of $2.1
billion provided a strong liquidity position at year-end 2005.
2005financialresults
10

13. Mortgage loans continue to be well diversified by property type,geographic location
and borrower. A 52% ratio of total amounts loaned to the fair value of collateral
properties reflects the credit strength of the company’s loan portfolio.
Regardless of short-term market volatility, equity investments remain an impor-
tant part of the company’s diversified investment strategy. These investments,
including public common stocks,real estate,private equities and subsidiary invest-
ments, enhance total investment returns over the long term, while diversifying
overall portfolio risk.
Financial strength
Surplus provides the company and its policyowners with protection against the
unexpected, while an asset valuation reserve (AVR) supports a long-term invest-
ment strategy by cushioning surplus against short-term market volatility.
Total surplus and AVR increased $1.4 billion, or 12%, to $12.9 billion at year-end
2005. This increase included $653 million of net realized and unrealized capital
gains (after taxes and deferrals), net operating gain of $614 million and $153
million in other net surplus increases.
The ratio of surplus and AVR to general account insurance reserves increased to
13.8% from 13.2% at year-end 2004. This total surplus position represents a
record high for the company on both an absolute and relative basis.
NorthwesternMutual’sfocusonsuperiorproductvalueandfinancialstrengthassures
that the company can meet its promises of financial security to its policyowners.
2005financialresults
11
Surplus and AVR
(in billions)
10.0
Market interest rates vs.
$12.0
Total assets
(in billions)
$125
75
50
01 02 03 04 05
Total investments
Separate account assets
Other assets
100
25

14. Summary of Operations and Changes in Surplus
(consolidated statutory basis, in millions)
12
2005
Year ended December 31: 2005 2004
Premiums $11,363 $10,682
Net investment income 6,543 6,117
Other income 494 511
Total revenue 18,400 17,310
Policyowner benefits paid 4,577 4,487
Increase in benefit reserves 7,109 6,603
Commissions and expenses 1,774 1,741
Total benefits and expenses 13,460 12,831
Gain before dividends and taxes 4,940 4,479
Policyowner dividends 4,269 3,880
Gain before taxes 671 599
Income tax expense (benefit) 57 (124)
Net gain from operations 614 723
Net realized capital gains 310 94
Net income 924 817
Change in net unrealized capital gains 343 645
Other net surplus changes 153 (87)
Net increase in surplus and AVR $1,420 $1,375
summary financial statements
Basis of Accounting
The accompanying summary financial information is based on accounting practices prescribed or
permitted by the Office of the Commissioner of Insurance of the State of Wisconsin (“statutory
basis of accounting”). Financial statements prepared on the statutory basis of accounting differ
materially from financial statements prepared in accordance with generally accepted accounting
principles (“GAAP”).

15. Summary of Financial Position
(consolidated statutory basis, in millions)
2005
December 31: 2005 2004
Bonds and short-term investments $68,023 $63,879
Mortgage loans 18,118 17,240
Policy loans 10,265 9,750
Common and preferred stocks 8,120 7,414
Real estate 1,620 1,619
Other investments 6,935 5,774
Total investments 113,081 105,676
Other assets 4,223 3,963
Separate account assets 15,753 14,318
Total assets $133,057 $123,957
Policy benefit reserves $94,144 $87,588
Policyowner dividends payable 4,270 3,910
Other liabilities 5,980 6,651
Separate account liabilities 15,753 14,318
Total liabilities (except AVR) 120,147 112,467
Asset valuation reserve (AVR) 2,529 2,556
Surplus 10,381 8,934
Total surplus and AVR 12,910 11,490
Total liabilities and surplus $133,057 $123,957
13
summary financial statements
Audited Financial Statements
PricewaterhouseCoopers LLP is the company’s independent accountant. The summary financial
statements above are derived from the company’s audited Consolidated Financial Statements.
The Consolidated Financial Statements are available at www.northwesternmutual.com or by
written request to Northwestern Mutual, Corporate Relations, Room 114, 720 East Wisconsin
Avenue, Milwaukee, Wisconsin 53202.

16. Responding to a Consolidating Marketplace
In our review of Northwestern Mutual, we, the members of the 2005 Policyowners’
Examining Committee, found a company with deep values reinforced by an expe-
rienced and ethical management team, devoted employees, and the most motivated
sales force in the industry. The core values echoed throughout our session were:
- A commitment to mutuality;
- Prudent investment management with the goal of maximizing long-term perfor-
mance; and
- An ongoing emphasis on efficiency, resulting in continuous operating improvement.
For almost a century,the company’s Board of Trustees has annually named
an outside group of three to five policyowners to make an independent and
completely unrestricted evaluation of the company’s operations, manage-
ment and strategic plans. The committee’s full report follows.
14
20052005 policyowners’ examining committee report
from left: Dale Jones, Managing Partner of Heidrick Struggles International, Inc. Atlanta,
Georgia; Robert D. Daleo,Executive Vice President and Chief Financial Officer of the Thomson
Corporation, Stamford, Connecticut; Adela Cepeda, Founder and President of A.C. Advisory,
Inc.; and Gerald Peters, President of Gerald Peters Gallery.

17. 15
Since 1857, Northwestern’s commitment to mutuality has been proven by industry-
leading dividend payouts, prudent underwriting, and the lowest operating expenses
as a percentage of life premium. All of these factors are underscored by the company’s
strong investment performance, which is anchored by a long-term outlook, port-
folio diversification, and prudent risk taking. The excellence of the product value
is recognized by Northwestern’s policyowners, who consistently choose to reinvest
their dividends in their Company, and by the marketplace, which acknowledges
Northwestern as an industry leader.
The following report represents a thorough assessment, grounded in conversations
with management, of a company that was transparent and fully engaged in this
comprehensive review.
Changing Environment
Our review and discussions yielded a central theme for the industry landscape going
forward: change and consolidation. The Company faces a consolidated marketplace
as insurance agencies, banks, and investment firms cross historic service boundaries,
causing a blurring of the lines of distinction. This shift is leading companies to further
diversify their product offerings and compete fiercely for customers and talent to
increase market share and grow revenue. In addition, while the whole life product
is a mature offering in the marketplace, there continue to be competitors pushing
various alternatives.
We found that management recognizes this challenge and the resulting need to:
- Bolster the core business of whole life, while marketing other key products;
- Address issues of diversity in the customer base, product offerings and field force;
- Develop products and strengthen marketing capabilities to support the financial
network;
- Promote the uniqueness and strength of the Northwestern product line, highlighting
competitive advantages such as commitment to mutuality, trusted representative-
client relationships, high-quality workforce, highest financial strength ratings, and
integrated manufacturing and distribution systems; and
- Emphasize talent management strategies to attract and retain the very best financial
representatives.
Human Capital
We are encouraged by the tremendous effort to recruit and retain the best talent
available. Historically, a forte of the Company has been its people and we see that
much success is due to strong relationships between financial representatives and
their clients. We affirm this and urge the Company to reinforce this strength by
successfully supporting current representatives, and developing recruitment and
retention plans to attract exceptional new representatives. The Company must take
measures to proactively guard its human capital value chain.
We also support the Company’s efforts to train and develop the next generation of
leaders. The knowledge, experience, and institutional memory of senior manage-
ment must be passed on successfully in order to ensure greater success.

18. Diversity
The value of diversity became a strong theme that we discussed in several contexts:
diversity of clientele, diversity of product offerings, and diversity of workforce.
In all three cases, the Company is becoming stronger as a result of these initiatives.
First, changing demographics in the marketplace represent an opportunity to serve
new clients. We see the Company acknowledging this change and adjusting strate-
gies to proactively serve the needs of these new customers. To ensure continued
success, the Company must innovate and properly prepare to capture these growing
affluent markets.
Second, we agree with past reports affirming the goal of product diversification. The
array of products and services must be expanded and effectively marketed to meet
changing needs while maintaining the excellent value of core insurance products.
Third, we affirm the Company’s focus on attracting and retaining a diverse work-
force, as it is a tremendous strength. We recognize efforts to increase gender, racial,
and ethnic diversity in leadership and throughout the Company, and we applaud it.
A workforce ideally reflects its customer demographics in order to understand the
variety of needs and effectively serve them. This arena is a challenge for all compa-
nies due to the high demand for a talented, diverse workforce, but as the industry
leader, we are confident the Company will be successful in its efforts.
Products and Marketing
Northwestern is known as “the Quiet Company,” and while that properly positions
the Company for one-to-one relationships with its customers, we are pleased with
the Company’s efforts to voice the strength, quality, and uniqueness of its products
against competitors. The Company continues to analyze how its products are
packaged and marketed, finding appropriate ways to reinforce its visibility in the
marketplace, while maintaining its “quiet” reputation.
Finally, it is crucial that the Company continue to prioritize the development of new
products and strategic marketing initiatives, as this serves to support the field force.
As the industry matures and demographic changes redefine the customer base, it is
imperative that the Company continue to strategically review its business model to
ensure that it offers industry-leading products, relationship-based service, and ex-
pert guidance to address its customers’ changing needs over a lifetime. Our financial
representatives are the face of the Company, and have to be equipped at the highest
level to serve our clients. We see this as a priority for management.
Conclusion
We,the2005POEC,havefoundNorthwesternMutualtobeinthehandsofseasoned
management and on the leading edge of a changing environment. Management’s
attention to the issues of talent retention, the promotion of competitive advantages,
the enhancement of marketing strategy, and the diversification of products, clients,
and the workforce makes us confident of the Company’s continued success. We en-
courage the Company to maintain the dual approach of inward review and refine-
ment, while monitoring the competitive landscape and the evolving industry. By
sustaininga healthy inside, reflected effectively to the outside, the Company is poised
to remain a market leader.

19. trustees17
Committee affiliation key:
1 Agency and Marketing
2 Audit
3 Executive
4 Finance
5 Human Resources, Nominating
and Corporate Governance
6 Operations and Technology
A ChairTrustees as of February 1, 2006
board of trustees
Edward E. Barr5
Retired Chairman, Sun Chemical
Corporation, Fort Lee, NJ
John M. Bremer 3
Chief Operating Officer, The
Northwestern Mutual Life Insurance
Company, Milwaukee, WI
Peter W. Bruce 3
Chief Insurance Officer, The
Northwestern Mutual Life Insurance
Company, Milwaukee, WI
Robert C. Buchanan 2 3 4
Non-Executive Chairman,
Fox Valley Corporation, Appleton, WI
George A. Dickerman 1
Retired Chairman and CEO, Spalding
Sports Worldwide, Longmeadow, MA
David J. Drury 2 3 4
President, Poblocki Sign
Company LLC, Milwaukee, WI
Connie K. Duckworth 3 4 5
President, ARZU,
Lake Forest, IL
James D. Ericson 1 3 4
Retired Chairman, The
Northwestern Mutual Life Insurance
Company, Milwaukee, WI
David A. Erne 3 4 6
Attorney, Milwaukee, WI
J. E. Gallegos 2
Attorney, Santa Fe, NM
James P. Hackett 2A
President and CEO, Steelcase Inc.,
Grand Rapids, MI
Hans Helmerich 2
President and CEO,
Helmerich Payne, Inc., Tulsa, OK
Stephen F. Keller 6
Attorney, Los Angeles, CA; former
Chairman, The Santa Anita Companies,
Arcadia, CA
Barbara A. King 1A
President, Landscape
Structures, Inc., Delano, MN
Margery Kraus 1
President and CEO,
APCO Worldwide, Washington, D.C.
J. Thomas Lewis 1
Attorney, New Orleans, LA
Daniel F. McKeithan, Jr. 3 4 5
President, Tamarack Petroleum
Company, Inc., Milwaukee, WI
Ulice Payne, Jr. 3 4 5
President and CEO,
Addison-Clifton, LLC, Brookfield, WI
H. Mason Sizemore, Jr. 6
Retired President and COO,
The Seattle Times, Seattle, WA
Peter M. Sommerhauser 3 4 5A
Attorney, Milwaukee, WI
John E. Steuri 6A
Retired Chairman and CEO,
ALLTEL Information Services, Inc.,
Little Rock, AR
John J. Stollenwerk 1 3 4
President and CEO, Allen-Edmonds
Shoe Corporation, Port Washington, WI
Barry L. Williams 6
President and CEO, Williams Pacific
Ventures, Inc., San Francisco, CA
Kathryn D. Wriston 2
Director of various corporations,
New York, NY
Edward J. Zore 1 3A 4A 6
President and CEO, The
Northwestern Mutual Life Insurance
Company, Milwaukee, WI

20. 18
2005corporate citizenship
Northwestern Mutual is committed to being an exemplary corporate citizen. In 2005,
our corporate citizenship took shape through many activities.
Supporting our communities
Northwestern Mutual has a Foundation whose mission is to inspire human potential
through lifelong learning and community commitment. The mission of the Northwestern
MutualFoundationcomesaliveinitsfinancialsupportforprogramsinthreefocusareas:
education, health and human services, and arts and culture. In 2005, our Foundation
made more than $13 million in grants and sponsorships nationally and in Milwaukee,
our corporate home. Highlights of initiatives funded by the Foundation include:
- The Matching Gifts Program. The Foundation matches, dollar-for-dollar, employee
and financial representative contributions to accredited schools. Last year, more than
$3.1 million was invested in schools of all educational levels across the nation.
- Medical research grants targeted at unraveling the mysteries of Alzheimer’s disease
and studying cardiovascular disease and stroke.
- Sponsorship of National Public Radio’s Morning Edition. Listeners across America
start their day by tuning in to entertaining and thought-provoking radio.
Tsunami and Hurricane Relief
In addition to its other philanthropic efforts, the Foundation contributed to vital human
relief efforts following the natural disasters caused by the South Asian tsunami and
Hurricane Katrina. Grants totaling $1.5 million from the Northwestern Mutual Foun-
dation were provided to the International and American Red Cross.

21. 19
Encouraging Volunteerism
Northwestern Mutual also lends support to its employees
and financial representatives who donate thousands of
hours each year to a wide variety of volunteer activities.
Through its Volunteer Support Program, the company
recognizes the volunteer efforts of employees by making
cash grants to those non-profit organizations to which
employees and retirees volunteer their time.
For financial representatives, the Northwestern Mutual
Foundation in 2005 donated $280,000 to 25 non-profit
organizations across the United States as part of the com-
pany’sCommunityServiceAwardprogram.Thisprogram
recognizes “outstanding volunteers” in the field force by
making contributions to organizations they represent.
Committed to Employees and the Field Force
Attracting and retaining top-level talent is of utmost importance to our future success.
Accordingly, we provide a work environment rich in continuing education, training and
advancement opportunities to help people reach their full potential as they serve our
policyowners and clients. Support for our employees and field force includes education
subsidies, continuous learning opportunities and recognition programs.
Diversity at Work
Northwestern Mutual’s commitment to diversity continues the company’s tradition of
providing a stimulating and rewarding work environment. Our commitment begins
with recruitment and emphasizes retaining employees and field representatives who
contribute to our diversity. In recognition of the company’s diversity efforts:
- In 2005, Northwestern Mutual ranked among the “Top 25 Companies for African-
Americans” in the United States by Black Professionals Magazine.
- Northwestern Mutual was also included in the “Top Employers for Women 2005,”
a list of the top employers for women published in a special advertising section in
FORTUNE®
Magazine. The section was prepared by Fortune Custom Projects based
on research conducted by SmartRevenue Research.
Also in 2005, Northwestern Mutual was a major sponsor of the annual conventions
of the National Association for the Advancement of Colored People (NAACP) and the
United States Hispanic Chamber of Commerce (USHCC).
Listening to Policyowners
Since its founding, Northwestern Mutual’s primary goal has been putting the needs of
its policyowners — those who depend on its long-term financial strength — first. In
pursuit of that objective, we engage in a unique practice. Each year the company invites
a small, diverse group of policyowners to visit our corporate headquarters to examine
our operations, finances and business practices firsthand. Following its on-site visit,
the Policyowners’ Examining Committee prepares an independent report documenting
how we’re doing. This year’s report starts on page 14.

22. ??
officers
20
Annual Meeting 8 a.m., May 24, 2006
The Annual Meeting of Policyowners of The Northwestern Mutual Life Insurance Company will
be held at 8:00 a.m., Wednesday, May 24, 2006, at the company’s Milwaukee Campus, 720
E. Wisconsin Avenue,Milwaukee,Wisconsin. The meeting will include the election of Trustees
of the company.
Please return your proxy by May 19, 2006
Proxies and proxy information are included with this report or will be furnished upon request.
Included in the proxy package is a pamphlet giving information about the persons proposed by
the board for election as Trustees. Policyowners unable to attend the Annual Meeting are urged
to exercise their right to vote by completing, signing and promptly returning their proxies. To be
counted in the election, proxies must reach the secretary of the company by May 19, 2006.
A career invitation
For information on a career as a Northwestern Mutual Financial Network Representative,
visit the Network Web site: www.nmfn.com.
Have a question?
Policy inquiries or general information? www.northwesternmutual.com
Billing and payment inquiries? Call (800) 388-8123
The company’s general phone number is (414) 271-1444
executive officers
Edward J. Zore, President and Chief Executive Officer, Deborah A. Beck, Executive Vice President
(Planning and Technology), William H. Beckley, Executive Vice President (Agencies), Robert J. Berdan,
Vice President, General Counsel and Secretary, John M. Bremer, Chief Operating Officer (Chief
Compliance Officer), Peter W. Bruce, Chief Insurance Officer, Michael G. Carter, Vice President
(Field Compensation and Planning), Steven T. Catlett, Vice President (Investment Products), Eric P.
Christophersen, Vice President (Compliance/Best Practices), David D. Clark, Vice President (Real
Estate), Gloster B. Current, Vice President (Policyowner Services), Mark G. Doll, Senior Vice President
(Public Markets), Thomas E. Dyer, Vice President (Corporate Services), Christina H. Fiasca, Senior
Vice President (Agency Services), John M. Grogan, Vice President (Disability Income), Richard L.
Hall, Senior Vice President (Life Product), J. Chris Kelly, Vice President and Controller, William C.
Koenig, Senior Vice President and Chief Actuary, John L. Kordsmeier, Vice President (New Business),
Susan A. Lueger, Vice President (Human Resources), Jeffrey J. Lueken, Vice President (Securities),
Jean M. Maier, Senior Vice President (Insurance Operations), Raymond J. Manista, Vice President
(Corporate Planning), Meridee J. Maynard, Senior Vice President, Gregory C. Oberland, Senior Vice
President and Chief Information Officer, Gary A. Poliner, Senior Vice President and Chief Financial
Officer, Marcia Rimai, Senior Vice President (Business Integration Services), Charles D. Robinson,
Senior Vice President (Investment Products and Services), Mason G. Ross, Executive Vice President
and Chief Investment Officer, John E. Schlifske, Senior Vice President (IPS and Affiliates), Calvin R.
Schmidt, Vice President (Investment Products Operations), David W. Simbro, Vice President (Long
Term Care), Brenda F. Skelton, Vice President (Communications), Leonard F. Stecklein, Senior Vice
President (IPS), J. Edward Tippetts, Vice President (Wealth Management), Donald G. Tyler, Vice
President (IPS Sales and Products), Martha M. Valerio, Vice President (Technology Research and Web
Resources), Michael L. Youngman, Vice President (Government Relations)
Executive Officers as of February 1, 2006

23. Subsidiaries
QuietCare®
long-term care insurance is offered through Northwestern Long Term Care Insur-
ance Company, Milwaukee, Wisconsin. Securities are offered through Northwestern Mutual
Investment Services,LLC (NMIS),Suite 300,611 East Wisconsin Ave.,Milwaukee,Wisconsin,
53202, (866) 664-7737, a wholly-owned company of Northwestern Mutual, broker-dealer and
member of the NASD and SIPC. Russell Investment Group is a registered trademark of Frank
Russell Company, a Washington, USA corporation, which operates through subsidiaries
worldwide. Frank Russell Company is a subsidiary of The Northwestern Mutual Life Insur-
ance Company. Northwestern Mutual Wealth Management Company, a wholly owned com-
pany of Northwestern Mutual, is a limited purpose federal savings bank and a registered
investment adviser.
More about dividends
Decisions with respect to the determination and allocation of divisible surplus are at the discre-
tion 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. Accord-
ingly, the company’s approach is subject to change. Neither the existence nor the amount of a
dividend is guaranteed in any given year.
“The Quiet Company” is a registered trademark of The Northwestern Mutual Life Insurance
Company, Milwaukee, WI.
Northwestern Mutual
Northwestern Mutual helps clients
protect against financial risk and
achieve financial security. The com-
pany, its subsidiaries and affiliates
offer insurance, investment products
and advisory services that address
client needs for financial protection,
capital accumulation, estate preser-
vation and asset distribution. Head-
quartered in Milwaukee, Wisconsin, the mutual company has more than 3 million
members and expects to continue as the leading U.S. company in total individual life
insurance dividends paid to policyowners.
Northwestern Mutual Financial Network
Northwestern Mutual Financial Network is the marketing name for the sales and
distribution arm of The Northwestern Mutual Life Insurance Company, its subsid-
iaries and affiliates, with financial representatives
in about 350 network offices nationwide. The
mission of Northwestern Mutual Financial Net-
work is to develop enduring relationships with clients by providing expert guidance
for a lifetime of financial security. With the help of a network of specialists, financial
representatives provide innovative solutions using world-class insurance products
and investment products.
21

24. ”
“
words of appreciation
2005
Throughout the year we received many appreciative messages from our customers.
We share just a few of them here.
“I’m very pleased with Northwestern Mutual’s earnings growth and dividends.
Northwestern was a great choice 30 years ago.” Tumwater, Washington
“Northwestern is a shining light in the corporate world, both in performance and
management ethics.” Cedar Springs, Michigan
“As usual, year after year Northwestern Mutual shows its great strength and finan-
cial competence.” Mamaroneck, New York
“Good job! I tell others about my Northwestern Mutual policies and they are
impressed.” Harbor Springs, Michigan
“Thank you for being a great insurance company. Every year when I receive my
annual report, I feel so proud to be part of such a great company. Keep up the excel-
lent work.” Linton, North Dakota
“As a policyholder, I am very pleased to be part of a great company, Northwestern
Mutual. I am proud to be a client.” Dartmouth, Massachusetts
“You folks never stop making Northwestern Mutual the absolutely best company
in the business world.” Sun City West, Arizona
“Keep up the good work. I hope our company always remains true to its culture.
Stay above board and honest at all times. This is the only investment I never worry
about.” Berkeley Heights, New Jersey
“I am a very happy policyowner of 10 great policies in Northwestern Mutual. My
first $5,000 policy bought in 1935 is nearly $60,000 today. All my other policies
are just as good. Northwestern Mutual management has been superior in every
way.” Colorado Springs, Colorado
“I am very satisfied with your company. Upon the death of my husband, the insur-
ance money was a necessity. Being a ‘struggling’ farm family, I am sorry we couldn’t
have invested more dollars with you.” Saint Germain, Wisconsin
The Northwestern Mutual
Life Insurance Company • Milwaukee, WI
www.northwesternmutual.com
90-0073-01 (0306)