March 11, 2011
VIA EDGAR
Securities and Exchange Commission
Division of Investment Management
100 F Street, NE
Washington, DC 20549
RE: | Northwestern Mutual Variable Life Account I | |
EDGAR CIK No. 0000742277; File No. 811-3989 | ||
Northwestern Mutual Variable Life Account II | ||
EDGAR CIK No. 0001359314; File No. 811-21933 |
Dear Sir or Madam:
On behalf of Northwestern Mutual Life Insurance Company and Northwestern Mutual Variable Life Account and Northwestern Mutual Variable Life Account II (Registrants or the Accounts) we hereby submit, pursuant to Rule 30b2-1 under the Investment Company Act of 1940 (the 1940 Act), that the Accounts annual report for the period ending December 31, 2010 has been transmitted to policy owners as required by Rule 30e-2 under the 1940 Act.
The following annual reports were filed with the Commission via EDGAR on the date indicated below and are incorporated herein by reference:
Underlying Investment Company | CIK No. | Date Filed | Registration No. | |||
Northwestern Mutual Series Fund, Inc. |
0000742212 | 3/07/2011 | 811-03990 | |||
Fidelity VIP Mid Cap Portfolio |
0000927384 | 2/22/2011 | 811-07205 | |||
Russell Investment Funds |
0000824036 | 3/08/2011 | 811-05371 |
Some of the investment companies above (or series thereof) may not be available under every policy offered by a Registrant.
In addition, performance summaries and financial statements for the Accounts are filed herewith. This filing will also include any other materials required to be filed, if any.
Please direct any questions or comments regarding this filing to the undersigned at 414-665-2418.
Sincerely, |
/s/ Barbara Courtney
|
Barbara Courtney |
Director Mutual Fund Accounting |
December 31, 2010
Annual Reports
Optimized to contain one or more of the following:* Northwestern Mutual Series Fund, Inc.
Fidelity® VIP Mid Cap Portfolio Russell Investment Funds
* See Table of Contents for more information and a list of Prospectus supplements included herein.
90-1899 (0786) (REV 0111)
The Northwestern Mutual Life Insurance Company (Northwestern Mutual)
How To Get More Information
Northwestern Mutual Express:
1-800-519-4665
Get up-to-date information about your policy at your convenience with your policy number and your Personal Identification Number (PIN). Call toll-free to review policy values, fund performance information, and request a change to the allocations of your existing assets or future premiums/dividends.
Information on the Internet:
Northwestern Mutual Financial Network www.northwesternmutual.com
To obtain current performance information and information about Northwestern Mutual, visit us on our website. You can also visit us at our customer service section from our Web site for information on policy values and current fund performance. This site also allows you to view past confirmation and policy statements, as well as transfer funds online.
To sign up for this service please call 1-866-424-2609 between 7 a.m. - 6 p.m. Central Time Monday - Friday. Your Northwestern Mutual Financial Representative is also available to answer any questions you have about your variable life insurance policy or any of our products.
For inforce policy service on Variable CompLife, Custom Variable Universal Life, and Variable Whole Life, please call 1-866-424-2609, between 7 a.m. - 6 p.m. Central Time Monday Friday.
For inforce policy service on Variable Executive Life, Variable Joint Life, Executive Variable Universal Life, and Survivorship Variable Universal Life, please call 1-866-464-3800, between 7:30 a.m. and 5:00 p.m. Central Time Monday - Friday.
Contents
Performance Summaries for the Northwestern Mutual Variable Life Accounts |
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Northwestern Mutual Series Fund, Inc. - Annual Report |
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Fidelity® VIP Mid Cap Portfolio - Annual Report (This report follows the end of the Northwestern Mutual Series Fund, Inc. report) |
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Russell Investment Funds - Annual Report (This report follows the end of the Fidelity® VIP Mid Cap Portfolio) |
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Northwestern Mutual Variable Life Account Financial Statements |
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Northwestern Mutual Variable Life Account II Financial Statements |
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Prospectus Supplements |
The performance data quoted represents past performance. Past performance is historical and does not guarantee future performance. Investment return and principal value will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the most recent month-end performance information visit www.northwesternmutual.com.
Performance Summary as of December 31, 2010
Variable LifePolicies Issued Before October 11, 1995
Total return (as of December 31, 2010) |
Growth Stock Division |
Focused Appreciation Division |
Large Cap Core Stock Division |
Index 500 Stock Division |
Domestic Equity Division |
Equity Income Division |
Mid Cap Growth Stock Division |
|||||||||||||||||||||
1 year |
11.76 | % | 8.73 | % | 12.29 | % | 14.27 | % | 13.99 | % | 14.70 | % | 23.18 | % | ||||||||||||||
5 years |
9.70 | % | 20.95 | % | 5.89 | % | 8.61 | % | (3.00 | %) | 10.40 | % | 20.19 | % | ||||||||||||||
Annualized |
1.87 | % | 3.88 | % | 1.15 | % | 1.67 | % | (0.61 | %) | 2.00 | % | 3.75 | % | ||||||||||||||
10 years |
(1.68 | %) | | (1.46 | %) | 7.24 | % | | | 10.83 | % | |||||||||||||||||
Annualized |
(0.17 | %) | | (0.15 | %) | 0.70 | % | | | 1.03 | % | |||||||||||||||||
Since division inception in Variable Life Account(b) |
| 99.31 | %(c) | | | 22.95 | %(d) | 60.74 | %(c) | | ||||||||||||||||||
Annualized |
| 9.41 | % | | | 2.22 | % | 6.39 | % | | ||||||||||||||||||
Current yield(f) |
||||||||||||||||||||||||||||
Variable ComplifePolicies Issued Between October 11, 1995 and December 31, 2008 | ||||||||||||||||||||||||||||
1 year |
11.87 | % | 8.84 | % | 12.41 | % | 14.38 | % | 14.11 | % | 14.81 | % | 23.30 | % | ||||||||||||||
5 years |
10.25 | % | 21.55 | % | 6.42 | % | 9.15 | % | (2.52 | %) | 10.95 | % | 20.78 | % | ||||||||||||||
Annualized |
1.97 | % | 3.98 | % | 1.25 | % | 1.77 | % | (0.51 | %) | 2.10 | % | 3.85 | % | ||||||||||||||
10 years |
(0.69 | %) | | (0.47 | %) | 8.31 | % | | | 11.94 | % | |||||||||||||||||
Annualized |
(0.07 | %) | | (0.05 | %) | 0.80 | % | | | 1.13 | % | |||||||||||||||||
Since division inception in Variable Life Account(b) |
| 100.83 | %(c) | | | 24.11 | %(d) | 61.98 | %(c) | | ||||||||||||||||||
Annualized |
| 9.52 | % | | | 2.32 | % | 6.49 | % | | ||||||||||||||||||
Current yield(f) |
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Variable Executive Life & Variable Joint Life(a) | ||||||||||||||||||||||||||||
1 year |
12.37 | % | 9.33 | % | 12.91 | % | 14.89 | % | 14.62 | % | 15.33 | % | 23.86 | % | ||||||||||||||
5 years |
12.75 | % | 24.31 | % | 8.84 | % | 11.63 | % | (0.30 | %) | 13.47 | % | 23.53 | % | ||||||||||||||
Annualized |
2.43 | % | 4.45 | % | 1.71 | % | 2.22 | % | (0.06 | %) | 2.56 | % | 4.32 | % | ||||||||||||||
10 years |
4.65 | % | | 4.88 | % | 14.14 | % | | | 17.97 | % | |||||||||||||||||
Annualized |
0.46 | % | | 0.48 | % | 1.33 | % | | | 1.67 | % | |||||||||||||||||
Since division inception in Variable Life Account(b) |
| 108.70 | %(c) | | | 30.33 | %(d) | 68.32 | %(c) | | ||||||||||||||||||
Annualized |
| 10.07 | % | | | 2.85 | % | 7.03 | % | | ||||||||||||||||||
Current yield(f) |
All total return figures shown above reflect the deduction of portfolio expenses. Returns do not reflect premium deductions such as sales charges, premium taxes, surrender charges or cost of insurance charges. The returns shown would be lower if excluded contract charges were included and/or if underlying portfolio expense reimbursements and fee waivers were not reflected.
Performance quoted for periods prior to each products inception date is based on the actual investment experience of the portfolio, adjusted for the expenses of the product and premium charges.
(a) | Variable Executive Life policies were offered from March 2, 1998 to December 31, 2008. Variable Joint Life policies were offered from December 28, 1998 to December 31, 2008. |
(b) | See the following footnotes for division and portfolio inception dates. |
(c) | Division and portfolio inception on May 1, 2003. |
(d) | Division and portfolio inception on July 31, 2001. |
(e) | Division inception on May 1, 2003. |
(f) | For the seven-day period ended December 31, 2010, the Money Market Portfolios yield was 0.25% and was equivalent to a compound effective yield of 0.25%. The seven-day yield does not include deductions that are included in the separate account. The yield quotation more closely reflects the current earnings of the Money Market Portfolio than the total return quotation. Effective December 31, 2008, the management fee of 0.30% for the Money Market Portfolio has been voluntarily waived. The performance shown for this division would have been lower without the fee waiver. This fee waiver is voluntary and may be revised or terminated at any time. |
i
Index 400 Stock Division |
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
International Equity Division |
Money Market Division |
Select Bond Division |
High Yield Bond Division |
Balanced Division |
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25.60 | % | 19.27 | % | 25.16 | % | 21.28 | % | 15.79 | % | 7.08 | % | (0.25 | %) | 6.00 | % | 13.93 | % | 11.34 | % | |||||||||||||||||||
27.40 | % | 6.72 | % | 5.35 | % | 26.33 | % | 2.71 | % | 21.14 | % | 11.54 | % | 29.26 | % | 43.24 | % | 19.80 | % | |||||||||||||||||||
4.96 | % | 1.31 | % | 1.05 | % | 4.79 | % | 0.54 | % | 3.91 | % | 2.21 | % | 5.27 | % | 7.45 | % | 3.68 | % | |||||||||||||||||||
84.24 | % | | 40.37 | % | | | 55.33 | % | 20.32 | % | 74.41 | % | 108.16 | % | 36.63 | % | ||||||||||||||||||||||
6.30 | % | | 3.45 | % | | | 4.50 | % | 1.87 | % | 5.72 | % | 7.61 | % | 3.17 | % | ||||||||||||||||||||||
| 74.57 | %(c) | | 112.45 | %(d) | 57.74 | %(d) | | | | | | ||||||||||||||||||||||||||
| 7.54 | % | | 8.33 | % | 4.96 | % | | | | | | ||||||||||||||||||||||||||
0.25 | % | |||||||||||||||||||||||||||||||||||||
25.72 | % | 19.39 | % | 25.29 | % | 21.40 | % | 15.91 | % | 7.19 | % | (0.15 | %) | 6.11 | % | 14.04 | % | 11.45 | % | |||||||||||||||||||
28.04 | % | 7.26 | % | 5.88 | % | 26.97 | % | 3.23 | % | 21.75 | % | 12.09 | % | 29.91 | % | 43.95 | % | 20.40 | % | |||||||||||||||||||
5.07 | % | 1.41 | % | 1.15 | % | 4.89 | % | 0.64 | % | 4.01 | % | 2.31 | % | 5.37 | % | 7.56 | % | 3.78 | % | |||||||||||||||||||
86.09 | % | | 41.78 | % | | | 56.89 | % | 21.53 | % | 76.16 | % | 110.25 | % | 38.00 | % | ||||||||||||||||||||||
6.41 | % | | 3.55 | % | | | 4.61 | % | 1.97 | % | 5.83 | % | 7.71 | % | 3.27 | % | ||||||||||||||||||||||
| 75.90 | %(c) | | 114.45 | %(d) | 59.23 | %(d) | | | | | | ||||||||||||||||||||||||||
| 7.64 | % | | 8.44 | % | 5.06 | % | | | | | | ||||||||||||||||||||||||||
0.25 | % | |||||||||||||||||||||||||||||||||||||
26.29 | % | 19.93 | % | 25.85 | % | 21.95 | % | 16.43 | % | 7.67 | % | 0.29 | % | 6.59 | % | 14.56 | % | 11.96 | % | |||||||||||||||||||
30.95 | % | 9.70 | % | 8.29 | % | 29.85 | % | 5.57 | % | 24.52 | % | 14.64 | % | 32.86 | % | 47.22 | % | 23.14 | % | |||||||||||||||||||
5.54 | % | 1.87 | % | 1.60 | % | 5.36 | % | 1.09 | % | 4.48 | % | 2.77 | % | 5.85 | % | 8.04 | % | 4.25 | % | |||||||||||||||||||
96.10 | % | | 49.41 | % | | | 65.33 | % | 28.07 | % | 85.64 | % | 121.55 | % | 45.42 | % | ||||||||||||||||||||||
6.97 | % | | 4.10 | % | | | 5.16 | % | 2.50 | % | 6.38 | % | 8.28 | % | 3.82 | % | ||||||||||||||||||||||
| 82.80 | %(c) | | 125.20 | %(d) | 67.21 | %(d) | | | | | | ||||||||||||||||||||||||||
| 8.18 | % | | 9.00 | % | 5.61 | % | | | | | | ||||||||||||||||||||||||||
0.25 | % |
ii
Performance Summary, continued as of December 31, 2010
Variable LifePolicies Issued Before October 11, 1995
Total return (as of December 31, 2010) |
Asset Allocation Division |
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
Russell Aggressive Equity Division |
Russell Non-U.S. Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
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1 year |
12.39 | % | 27.87 | % | 15.82 | % | 24.20 | % | 10.81 | % | 22.25 | % | 9.42 | % | ||||||||||||||
5 years |
17.41 | % | 36.87 | % | 10.10 | % | 8.18 | % | 7.51 | % | 11.59 | % | 32.97 | % | ||||||||||||||
Annualized |
3.26 | % | 6.48 | % | 1.94 | % | 1.58 | % | 1.46 | % | 2.22 | % | 5.86 | % | ||||||||||||||
10 years |
| 133.36 | % | 6.35 | % | 46.68 | % | 28.21 | % | 152.16 | % | 70.12 | % | |||||||||||||||
Annualized |
| 8.84 | % | 0.62 | % | 3.91 | % | 2.52 | % | 9.69 | % | 5.46 | % | |||||||||||||||
Since division inception in Variable Life Account(b) |
42.02 | %(d) | 178.03 | %(e) | | | | | | |||||||||||||||||||
Annualized |
3.79 | % | 14.26 | % | | | | | | |||||||||||||||||||
Current yield(f) |
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Variable ComplifePolicies Issued Between October 11, 1995 and December 31, 2008 | ||||||||||||||||||||||||||||
1 year |
12.50 | % | 28.00 | % | 15.94 | % | 24.32 | % | 10.92 | % | 22.37 | % | 9.53 | % | ||||||||||||||
5 years |
17.99 | % | 37.56 | % | 10.65 | % | 8.72 | % | 8.05 | % | 12.15 | % | 33.63 | % | ||||||||||||||
Annualized |
3.36 | % | 6.59 | % | 2.05 | % | 1.69 | % | 1.56 | % | 2.32 | % | 5.97 | % | ||||||||||||||
10 years |
| 135.71 | % | 7.42 | % | 48.16 | % | 29.49 | % | 154.69 | % | 71.83 | % | |||||||||||||||
Annualized |
| 8.95 | % | 0.72 | % | 4.01 | % | 2.62 | % | 9.80 | % | 5.56 | % | |||||||||||||||
Since division inception in Variable Life Account(b) |
43.36 | %(d) | 180.16 | %(e) | | | | | | |||||||||||||||||||
Annualized |
3.90 | % | 14.38 | % | | | | | | |||||||||||||||||||
Current yield(f) |
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Variable Executive Life & Variable Joint Life(a) | ||||||||||||||||||||||||||||
1 year |
13.01 | % | 28.57 | % | 16.46 | % | 24.88 | % | 11.42 | % | 22.92 | % | 10.02 | % | ||||||||||||||
5 years |
20.67 | % | 40.68 | % | 13.17 | % | 11.19 | % | 10.50 | % | 14.70 | % | 36.67 | % | ||||||||||||||
Annualized |
3.83 | % | 7.07 | % | 2.51 | % | 2.14 | % | 2.02 | % | 2.78 | % | 6.45 | % | ||||||||||||||
10 years |
| 148.40 | % | 13.20 | % | 56.13 | % | 36.46 | % | 168.40 | % | 81.07 | % | |||||||||||||||
Annualized |
| 9.53 | % | 1.25 | % | 4.56 | % | 3.16 | % | 10.38 | % | 6.12 | % | |||||||||||||||
Since division inception in Variable Life Account(b) |
50.54 | %(d) | 191.13 | %(e) | | | | | | |||||||||||||||||||
Annualized |
4.44 | % | 14.95 | % | | | | | | |||||||||||||||||||
Current yield(f) |
All total return figures shown above reflect the deduction of portfolio expenses. Returns do not reflect premium deductions such as sales charges, premium taxes, surrender charges or cost of insurance charges. The returns shown would be lower if excluded contract charges were included and/or if underlying portfolio expense reimbursements and fee waivers were not reflected.
Performance quoted for periods prior to each products inception date is based on the actual investment experience of the portfolio, adjusted for the expenses of the product and premium charges.
(a) | Variable Executive Life policies were offered from March 2, 1998 to December 31, 2008. Variable Joint Life policies were offered from December 28, 1998 to December 31, 2008. |
(b) | See the following footnotes for division and portfolio inception dates. |
(c) | Division and portfolio inception on May 1, 2003. |
(d) | Division and portfolio inception on July 31, 2001. |
(e) | Division inception on May 1, 2003. |
(f) | For the seven-day period ended December 31, 2010, the Money Market Portfolios yield was 0.25% and was equivalent to a compound effective yield of 0.25%. The seven-day yield does not include deductions that are included in the separate account. The yield quotation more closely reflects the current earnings of the Money Market Portfolio than the total return quotation. Effective December 31, 2008, the management fee of 0.30% for the Money Market Portfolio has been voluntarily waived. The performance shown for this division would have been lower without the fee waiver. This fee waiver is voluntary and may be revised or terminated at any time. |
iii
Performance Summary, continued as of December 31, 2010
Custom Variable Universal Life, Executive Variable Universal Life & Survivorship Variable Universal Life
Total return (as of December 31, 2010) |
Growth Stock Division |
Focused Appreciation Division |
Large Cap Core Stock Division |
Index 500 Stock Division |
Domestic Equity Division |
Equity Income Division |
Mid Cap Growth Stock Division |
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1 year |
12.37 | % | 9.33 | % | 12.91 | % | 14.89 | % | 14.62 | % | 15.33 | % | 23.86 | % | ||||||||||||||
5 years |
12.75 | % | 24.31 | % | 8.84 | % | 11.63 | % | (0.30 | %) | 13.47 | % | 23.53 | % | ||||||||||||||
Annualized |
2.43 | % | 4.45 | % | 1.71 | % | 2.22 | % | (0.06 | %) | 2.56 | % | 4.32 | % | ||||||||||||||
10 years |
4.65 | % | | 4.88 | % | 14.14 | % | | | 17.97 | % | |||||||||||||||||
Annualized |
0.46 | % | | 0.48 | % | 1.33 | % | | | 1.67 | % | |||||||||||||||||
Since division inception in Variable Life Account II |
0.80 | % | 16.65 | % | (4.02 | %) | (4.85 | %) | (15.31 | %) | (6.12 | %) | 13.76 | % | ||||||||||||||
Annualized |
0.20 | % | 4.01 | % | (1.04 | %) | (1.26 | %) | (4.16 | %) | (1.60 | %) | 3.35 | % | ||||||||||||||
Since portfolio inception (a) |
| 108.70 | %(b) | | | 30.33 | %(c) | 68.32 | %(b) | | ||||||||||||||||||
Annualized |
| 10.07 | % | | | 2.85 | % | 7.03 | % | | ||||||||||||||||||
Current yield (d) |
All total return figures shown above reflect the deduction of portfolio expenses. Returns do not reflect premium deductions such as sales charges, premium taxes, surrender charges or cost of insurance charges. The returns shown would be lower if excluded contract charges were included and/or if underlying portfolio expense reimbursements and fee waivers were not reflected.
All policies were first offered and all divisions of the Variable Life Account II began on January 31, 2007. Performance quoted for periods prior to January 31, 2007 is based on the actual investment experience of the portfolio, adjusted for the expenses of the product and premium charges.
(a) | Returns are stated as of the inception date of the portfolio, which precedes the inception date of the division. See the following footnotes for portfolio inception dates. |
(b) | Portfolio inception on May 1, 2003. |
(c) | Portfolio inception on July 31, 2001. |
(d) | For the seven-day period ended December 31, 2010, the Money Market Portfolios yield was 0.25% and was equivalent to a compound effective yield of 0.25%. The seven-day yield does not include deductions that are included in the separate account. The yield quotation more closely reflects the current earnings of the Money Market Portfolio than the total return quotation. Effective December 31, 2008, the management fee of 0.30% for the Money Market Portfolio has been voluntarily waived. The performance shown for this division would have been lower without the fee waiver. This fee waiver is voluntary and may be revised or terminated at any time. |
iv
Performance Summary, continued as of December 31, 2010
Custom Variable Universal Life, Executive Variable Universal Life & Survivorship Variable Universal Life
Total return (as of December 31, 2010) |
Index 400 Stock Division |
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
International Equity Division |
Money Market Division |
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1 year |
26.29 | % | 19.93 | % | 25.85 | % | 21.95 | % | 16.43 | % | 7.67 | % | 0.29 | % | ||||||||||||||
5 years |
30.95 | % | 9.70 | % | 8.29 | % | 29.85 | % | 5.57 | % | 24.52 | % | 14.64 | % | ||||||||||||||
Annualized |
5.54 | % | 1.87 | % | 1.60 | % | 5.36 | % | 1.09 | % | 4.48 | % | 2.77 | % | ||||||||||||||
10 years |
96.10 | % | | 49.41 | % | | | 65.33 | % | 28.07 | % | |||||||||||||||||
Annualized |
6.97 | % | | 4.10 | % | | | 5.16 | % | 2.50 | % | |||||||||||||||||
Since division inception in Variable Life Account II |
14.87 | % | (6.34 | %) | (0.62 | %) | 8.69 | % | (13.78 | %) | (6.32 | %) | 8.86 | % | ||||||||||||||
Annualized |
3.60 | % | (1.66 | %) | (0.16 | %) | 2.15 | % | (3.72 | %) | (1.65 | %) | 2.19 | % | ||||||||||||||
Since portfolio inception (a) |
| 82.80 | %(b) | | 125.20 | %(c) | 67.21 | %(c) | | | ||||||||||||||||||
Annualized |
| 8.18 | % | | 9.00 | % | 5.61 | % | | | ||||||||||||||||||
Current yield (d) |
0.25 | % |
All total return figures shown above reflect the deduction of portfolio expenses. Returns do not reflect premium deductions such as sales charges, premium taxes, surrender charges or cost of insurance charges. The returns shown would be lower if excluded contract charges were included and/or if underlying portfolio expense reimbursements and fee waivers were not reflected.
All policies were first offered and all divisions of the Variable Life Account II began on January 31, 2007. Performance quoted for periods prior to January 31, 2007 is based on the actual investment experience of the portfolio, adjusted for the expenses of the product and premium charges.
(a) | Returns are stated as of the inception date of the portfolio, which precedes the inception date of the division. See the following footnotes for portfolio inception dates. |
(b) | Portfolio inception on May 1, 2003. |
(c) | Portfolio inception on July 31, 2001. |
(d) | For the seven-day period ended December 31, 2010, the Money Market Portfolios yield was 0.25% and was equivalent to a compound effective yield of 0.25%. The seven-day yield does not include deductions that are included in the separate account. The yield quotation more closely reflects the current earnings of the Money Market Portfolio than the total return quotation. Effective December 31, 2008, the management fee of 0.30% for the Money Market Portfolio has been voluntarily waived. The performance shown for this division would have been lower without the fee waiver. This fee waiver is voluntary and may be revised or terminated at any time. |
v
Select Bond Division |
High Yield Bond Division |
Balanced Division |
Asset Allocation Division |
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
Russell Aggressive Equity Division |
Russell Non-U.S. Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||||||||
6.59 | % | 14.56 | % | 11.96 | % | 13.01 | % | 28.57 | % | 16.46 | % | 24.88 | % | 11.42 | % | 22.92 | % | 10.02 | % | |||||||||||||||||||
32.86 | % | 47.22 | % | 23.14 | % | 20.67 | % | 40.68 | % | 13.17 | % | 11.19 | % | 10.50 | % | 14.70 | % | 36.67 | % | |||||||||||||||||||
5.85 | % | 8.04 | % | 4.25 | % | 3.83 | % | 7.07 | % | 2.51 | % | 2.14 | % | 2.02 | % | 2.78 | % | 6.45 | % | |||||||||||||||||||
85.64 | % | 121.55 | % | 45.42 | % | | 148.40 | % | 13.20 | % | 56.13 | % | 36.46 | % | 168.40 | % | 81.07 | % | ||||||||||||||||||||
6.38 | % | 8.28 | % | 3.82 | % | | 9.53 | % | 1.25 | % | 4.56 | % | 3.16 | % | 10.38 | % | 6.12 | % | ||||||||||||||||||||
27.96 | % | 33.03 | % | 10.56 | % | 8.63 | % | 23.22 | % | (1.28 | %) | (5.10 | %) | (11.39 | %) | (22.36 | %) | 31.90 | % | |||||||||||||||||||
6.50 | % | 7.56 | % | 2.60 | % | 2.14 | % | 5.48 | % | (0.33 | %) | (1.33 | %) | (3.04 | %) | (6.26 | %) | 7.33 | % | |||||||||||||||||||
| | | 50.54 | %(c) | | | | | | | ||||||||||||||||||||||||||||
| | | 4.44 | % | | | | | | | ||||||||||||||||||||||||||||
vi
Annual Report December 31, 2010
Northwestern Mutual Variable Life Account
Financial Statements
Northwestern Mutual Variable Life Account Financial Statements
Northwestern Mutual Variable Life Account |
||||
1 | ||||
4 | ||||
6 | ||||
10 | ||||
15 |
Statements of Assets and Liabilities
Northwestern Mutual Variable Life Account
December 31, 2010
(in thousands, except accumulation unit values)
Growth Stock Division |
Focused Appreciation Division |
Large Cap Core Stock Division |
Index 500 Stock Division |
Domestic Equity Division |
Equity Income Division |
Mid Cap Growth Stock Division |
||||||||||||||||||||||
Assets: |
||||||||||||||||||||||||||||
Investments, at Value (1) |
||||||||||||||||||||||||||||
Northwestern Mutual Series Fund, Inc. |
$ | 288,688 | $ | 97,870 | $ | 193,012 | $ | 730,891 | $ | 134,537 | $ | 73,855 | $ | 404,120 | ||||||||||||||
Fidelity Variable Insurance Products |
| | | | | | | |||||||||||||||||||||
Russell Investment Funds |
| | | | | | | |||||||||||||||||||||
Due from Northwestern Mutual Life Insurance Company |
13 | | | | 95 | | | |||||||||||||||||||||
Total Assets |
288,701 | 97,870 | 193,012 | 730,891 | 134,632 | 73,855 | 404,120 | |||||||||||||||||||||
Liabilities: |
||||||||||||||||||||||||||||
Due to Northwestern Mutual Life Insurance Company |
| 7 | 16 | | | 15 | 46 | |||||||||||||||||||||
Total Liabilities |
| 7 | 16 | | | 15 | 46 | |||||||||||||||||||||
Total Net Assets |
$ | 288,701 | $ | 97,863 | $ | 192,996 | $ | 730,891 | $ | 134,632 | $ | 73,840 | $ | 404,074 | ||||||||||||||
Net Assets: |
||||||||||||||||||||||||||||
Variable Life Policies Issued |
||||||||||||||||||||||||||||
Before October 11, 1995 |
||||||||||||||||||||||||||||
Policyowners Equity |
$ | 26,089 | $ | 6,931 | $ | 21,509 | $ | 104,930 | $ | 12,385 | $ | 6,048 | $ | 57,061 | ||||||||||||||
Northwestern Mutuals Equity |
628 | 128 | 563 | 2,221 | 291 | 122 | 1,278 | |||||||||||||||||||||
Variable CompLife Policies Issued Between October 11, 1995 and December 31, 2008 (2) |
||||||||||||||||||||||||||||
Policyowners Equity |
235,722 | 77,603 | 151,191 | 544,305 | 104,901 | 59,557 | 320,416 | |||||||||||||||||||||
Northwestern Mutuals Equity |
11,522 | 4,326 | 7,448 | 27,273 | 6,205 | 3,098 | 14,808 | |||||||||||||||||||||
Variable Executive Life Policies Issued Between March 2, 1998 and December 31, 2008 (3) |
||||||||||||||||||||||||||||
Policyowners Equity |
8,317 | 5,022 | 7,715 | 20,483 | 5,303 | 1,490 | 3,878 | |||||||||||||||||||||
Variable Joint Life Policies Issued Between December 10, 1998 and December 31, 2008 (4) |
||||||||||||||||||||||||||||
Policyowners Equity |
6,423 | 3,853 | 4,570 | 31,679 | 5,547 | 3,525 | 6,633 | |||||||||||||||||||||
Total Net Assets |
$ | 288,701 | $ | 97,863 | $ | 192,996 | $ | 730,891 | $ | 134,632 | $ | 73,840 | $ | 404,074 | ||||||||||||||
(1) Investments, at cost |
$ | 258,411 | $ | 89,990 | $ | 179,003 | $ | 745,803 | $ | 155,558 | $ | 78,268 | $ | 377,379 | ||||||||||||||
Mutual Fund Shares Held |
135,280 | 52,534 | 155,279 | 281,004 | 152,019 | 61,907 | 129,650 | |||||||||||||||||||||
(2) Accumulation Unit Value |
$ | 2.434967 | $ | 2.008299 | $ | 1.972165 | $ | 2.602259 | $ | 1.241092 | $ | 1.619759 | $ | 2.625759 | ||||||||||||||
Units Outstanding |
101,540 | 40,795 | 80,440 | 219,648 | 89,523 | 38,682 | 127,668 | |||||||||||||||||||||
(3) Accumulation Unit Value |
$ | 32.998214 | $ | 20.869750 | $ | 26.477036 | $ | 58.583796 | $ | 13.033112 | $ | 16.832155 | $ | 71.778944 | ||||||||||||||
Units Outstanding |
252 | 241 | 291 | 350 | 407 | 89 | 54 | |||||||||||||||||||||
(4) Accumulation Unit Value |
$ | 32.998214 | $ | 20.869750 | $ | 26.477036 | $ | 58.583796 | $ | 13.033112 | $ | 16.832155 | $ | 71.778944 | ||||||||||||||
Units Outstanding |
195 | 185 | 173 | 541 | 425 | 209 | 92 |
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Assets and Liabilities
1
Statements of Assets and Liabilities
Northwestern Mutual Variable Life Account
December 31, 2010
(in thousands, except accumulation unit values)
Index
400 |
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
International Equity Division |
Money Market Division |
||||||||||||||||||||||
Assets: |
||||||||||||||||||||||||||||
Investments, at Value (1) |
||||||||||||||||||||||||||||
Northwestern Mutual Series Fund, Inc. |
$ | 208,550 | $ | 39,839 | $ | 201,117 | $ | 144,066 | $ | 94,949 | $ | 508,646 | $ | 169,089 | ||||||||||||||
Fidelity Variable Insurance Products |
| | | | | | | |||||||||||||||||||||
Russell Investment Funds |
| | | | | | | |||||||||||||||||||||
Due from Northwestern Mutual Life Insurance Company |
| | | | 25 | 77 | 27 | |||||||||||||||||||||
Total Assets |
208,550 | 39,839 | 201,117 | 144,066 | 94,974 | 508,723 | 169,116 | |||||||||||||||||||||
Liabilities: |
||||||||||||||||||||||||||||
Due to Northwestern Mutual Life Insurance Company |
29 | | 5 | 57 | | | | |||||||||||||||||||||
Total Liabilities |
29 | | 5 | 57 | | | | |||||||||||||||||||||
Total Net Assets |
$ | 208,521 | $ | 39,839 | $ | 201,112 | $ | 144,009 | $ | 94,974 | $ | 508,723 | $ | 169,116 | ||||||||||||||
Net Assets: |
||||||||||||||||||||||||||||
Variable Life Policies Issued |
||||||||||||||||||||||||||||
Before October 11, 1995 |
||||||||||||||||||||||||||||
Policyowners Equity |
$ | 10,476 | $ | 2,433 | $ | 9,192 | $ | 10,946 | $ | 5,357 | $ | 61,627 | $ | 12,024 | ||||||||||||||
Northwestern Mutuals Equity |
183 | 51 | 186 | 213 | 105 | 1,364 | 256 | |||||||||||||||||||||
Variable CompLife Policies Issued Between October 11, 1995 and December 31, 2008 (2) |
||||||||||||||||||||||||||||
Policyowners Equity |
176,595 | 31,215 | 170,705 | 116,227 | 73,844 | 393,542 | 125,701 | |||||||||||||||||||||
Northwestern Mutuals Equity |
8,771 | 1,820 | 9,160 | 6,430 | 4,308 | 19,776 | 9,041 | |||||||||||||||||||||
Variable Executive Life Policies Issued Between March 2, 1998 and December 31, 2008 (3) |
||||||||||||||||||||||||||||
Policyowners Equity |
6,071 | 3,045 | 4,783 | 4,301 | 7,486 | 18,646 | 13,329 | |||||||||||||||||||||
Variable Joint Life Policies Issued Between December 10, 1998 and December 31, 2008 (4) |
||||||||||||||||||||||||||||
Policyowners Equity |
6,425 | 1,275 | 7,086 | 5,892 | 3,874 | 13,768 | 8,765 | |||||||||||||||||||||
Total Net Assets |
$ | 208,521 | $ | 39,839 | $ | 201,112 | $ | 144,009 | $ | 94,974 | $ | 508,723 | $ | 169,116 | ||||||||||||||
(1) Investments, at cost |
$ | 181,571 | $ | 43,848 | $ | 209,856 | $ | 129,771 | $ | 109,928 | $ | 481,510 | $ | 169,089 | ||||||||||||||
Mutual Fund Shares Held |
142,161 | 34,285 | 113,306 | 85,499 | 78,470 | 294,697 | 169,089 | |||||||||||||||||||||
(2) Accumulation Unit Value |
$ | 2.311836 | $ | 1.759035 | $ | 2.308077 | $ | 2.144514 | $ | 1.592294 | $ | 2.718891 | $ | 1.559508 | ||||||||||||||
Units Outstanding |
80,182 | 18,781 | 77,929 | 57,196 | 49,082 | 152,018 | 86,400 | |||||||||||||||||||||
(3) Accumulation Unit Value |
$ | 25.934506 | $ | 18.279525 | $ | 29.671998 | $ | 22.519799 | $ | 16.720938 | $ | 4.095847 | $ | 41.380226 | ||||||||||||||
Units Outstanding |
234 | 167 | 161 | 191 | 448 | 4,552 | 322 | |||||||||||||||||||||
(4) Accumulation Unit Value |
$ | 25.934506 | $ | 18.279525 | $ | 29.671998 | $ | 22.519799 | $ | 16.720938 | $ | 4.095847 | $ | 41.380226 | ||||||||||||||
Units Outstanding |
248 | 70 | 238 | 262 | 232 | 3,361 | 212 |
The Accompanying Notes are an Integral Part of the Financial Statements.
2
Statements of Assets and Liabilities
Select Bond Division |
High Yield Bond Division |
Balanced Division |
Asset Allocation Division |
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
Russell Aggressive Equity Division |
Russell Non-US Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||||||||
$ | 238,702 | $ | 92,377 | $ | 323,296 | $ | 40,865 | $ | | $ | | $ | | $ | | $ | | $ | | |||||||||||||||||||
| | | | 140,650 | | | | | | |||||||||||||||||||||||||||||
| | | | | 173,425 | 85,266 | 131,849 | 139,684 | 98,089 | |||||||||||||||||||||||||||||
103 | 4 | | | 16 | 83 | | 12 | 26 | 60 | |||||||||||||||||||||||||||||
238,805 | 92,381 | 323,296 | 40,865 | 140,666 | 173,508 | 85,266 | 131,861 | 139,710 | 98,149 | |||||||||||||||||||||||||||||
| | 47 | 5 | | | 13 | | | | |||||||||||||||||||||||||||||
| | 47 | 5 | | | 13 | | | | |||||||||||||||||||||||||||||
$ | 238,805 | $ | 92,381 | $ | 323,249 | $ | 40,860 | $ | 140,666 | $ | 173,508 | $ | 85,253 | $ | 131,861 | $ | 139,710 | $ | 98,149 | |||||||||||||||||||
$ | 22,616 | $ | 7,258 | $ | 146,492 | $ | 5,343 | $ | 13,347 | $ | 7,632 | $ | 5,029 | $ | 7,799 | $ | 8,195 | $ | 7,114 | |||||||||||||||||||
436 | 144 | 2,094 | 103 | 242 | 162 | 93 | 174 | 161 | 191 | |||||||||||||||||||||||||||||
173,304 | 74,389 | 153,813 | 30,899 | 108,602 | 132,240 | 69,073 | 99,384 | 112,547 | 59,226 | |||||||||||||||||||||||||||||
9,254 | 3,547 | 7,586 | 1,604 | 6,310 | 7,688 | 3,959 | 5,552 | 6,296 | 3,235 | |||||||||||||||||||||||||||||
23,316 | 3,470 | 7,934 | 1,166 | 7,095 | 18,143 | 4,176 | 12,744 | 7,500 | 23,958 | |||||||||||||||||||||||||||||
9,879 | 3,573 | 5,330 | 1,745 | 5,070 | 7,643 | 2,923 | 6,208 | 5,011 | 4,425 | |||||||||||||||||||||||||||||
$ | 238,805 | $ | 92,381 | $ | 323,249 | $ | 40,860 | $ | 140,666 | $ | 173,508 | $ | 85,253 | $ | 131,861 | $ | 139,710 | $ | 98,149 | |||||||||||||||||||
$ | 227,759 | $ | 85,475 | $ | 360,142 | $ | 41,336 | $ | 128,705 | $ | 152,638 | $ | 90,580 | $ | 146,274 | $ | 150,161 | $ | 94,282 | |||||||||||||||||||
185,616 | 127,592 | 230,761 | 38,956 | 4,378 | 12,771 | 7,153 | 12,914 | 10,035 | 9,333 | |||||||||||||||||||||||||||||
$ | 2.341027 | $ | 2.662698 | $ | 2.557927 | $ | 1.433617 | $ | 2.801620 | $ | 0.975990 | $ | 1.531783 | $ | 1.368210 | $ | 3.023867 | $ | 1.882787 | |||||||||||||||||||
77,982 | 29,270 | 63,098 | 22,672 | 41,016 | 143,371 | 47,678 | 76,697 | 39,302 | 33,175 | |||||||||||||||||||||||||||||
$ | 181.992325 | $ | 34.475967 | $ | 137.200077 | $ | 15.054442 | $ | 29.113348 | $ | 10.686543 | $ | 17.202203 | $ | 14.635995 | $ | 31.671345 | $ | 19.746605 | |||||||||||||||||||
128 | 101 | 58 | 77 | 244 | 1,698 | 243 | 871 | 237 | 1,213 | |||||||||||||||||||||||||||||
$ | 181.992325 | $ | 34.475967 | $ | 137.200077 | $ | 15.054442 | $ | 29.113348 | $ | 10.686543 | $ | 17.202203 | $ | 14.635995 | $ | 31.671345 | $ | 19.746605 | |||||||||||||||||||
54 | 104 | 39 | 116 | 174 | 715 | 170 | 424 | 158 | 224 |
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Assets and Liabilities
3
Northwestern Mutual Variable Life Account
For the Year Ended December 31, 2010
(in thousands)
Growth |
Focused Appreciation Division |
Large Cap Core Stock Division |
Index 500 Stock Division |
|||||||||||||
Income: |
||||||||||||||||
Dividend income |
$ | 2,172 | $ | | $ | 2,096 | $ | 13,302 | ||||||||
Expenses: |
||||||||||||||||
Mortality and expense risk charges |
1,137 | 372 | 752 | 2,831 | ||||||||||||
Taxes |
12 | 3 | 10 | 49 | ||||||||||||
Net investment income (loss) |
1,023 | (375 | ) | 1,334 | 10,422 | |||||||||||
Realized gain (loss) on investments: |
||||||||||||||||
Realized gain (loss) on sale of fund shares |
(2,545 | ) | 263 | (4,215 | ) | (9,877 | ) | |||||||||
Realized gain distributions |
| | | 5,003 | ||||||||||||
Realized gains (losses) |
(2,545 | ) | 263 | (4,215 | ) | (4,874 | ) | |||||||||
Change in unrealized appreciation/depreciation of investments during the period |
31,797 | 7,977 | 24,055 | 87,360 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
$ | 30,275 | $ | 7,865 | $ | 21,174 | $ | 92,908 | ||||||||
International Equity Division |
Money Market Division |
Select Bond Division |
High Yield Bond Division |
|||||||||||||
Income: |
||||||||||||||||
Dividend income |
$ | 14,029 | $ | 520 | $ | 8,842 | $ | 6,285 | ||||||||
Expenses: |
||||||||||||||||
Mortality and expense risk charges |
2,018 | 705 | 920 | 368 | ||||||||||||
Taxes |
30 | 7 | 11 | 4 | ||||||||||||
Net investment income (loss) |
11,981 | (192 | ) | 7,911 | 5,913 | |||||||||||
Realized gain (loss) on investments: |
||||||||||||||||
Realized gain (loss) on sale of fund shares |
(104 | ) | | 1,130 | 965 | |||||||||||
Realized gain distributions |
| 12 | 654 | | ||||||||||||
Realized gains (losses) |
(104 | ) | 12 | 1,784 | 965 | |||||||||||
Change in unrealized appreciation/depreciation of investments during the period |
21,731 | | 4,063 | 4,752 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
$ | 33,608 | $ | (180 | ) | $ | 13,758 | $ | 11,630 | |||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
4
Statements of Operations
Domestic Equity Division |
Equity Income Division |
Mid Cap Growth Stock Division |
Index 400 Stock Division |
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
|||||||||||||||||||||||
$ | 2,770 | $ | 1,108 | $ | 982 | $ | 2,017 | $ | 488 | $ | 1,287 | $ | 1,372 | $ | 758 | |||||||||||||||
507 | 275 | 1,586 | 780 | 142 | 733 | 533 | 331 | |||||||||||||||||||||||
6 | 3 | 26 | 5 | 1 | 4 | 5 | 2 | |||||||||||||||||||||||
2,257 | 830 | (630 | ) | 1,232 | 345 | 550 | 834 | 425 | ||||||||||||||||||||||
(2,430 | ) | (1,589 | ) | (9,482 | ) | 66 | (2,078 | ) | (3,440 | ) | 2,044 | (2,650 | ) | |||||||||||||||||
| | | 665 | | | | | |||||||||||||||||||||||
(2,430 | ) | (1,589 | ) | (9,482 | ) | 731 | (2,078 | ) | (3,440 | ) | 2,044 | (2,650 | ) | |||||||||||||||||
16,855 | 10,104 | 87,530 | 41,347 | 8,178 | 43,682 | 22,606 | 15,011 | |||||||||||||||||||||||
$ | 16,682 | $ | 9,345 | $ | 77,418 | $ | 43,310 | $ | 6,445 | $ | 40,792 | $ | 25,484 | $ | 12,786 | |||||||||||||||
Balanced Division |
Asset Allocation Division |
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
Russell Aggressive Equity Division |
Russell Non-US Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||
$ | 6,464 | $ | 1,113 | $ | 152 | $ | 1,443 | $ | 346 | $ | 1,105 | $ | 2,825 | $ | 3,618 | |||||||||||||||
1,388 | 162 | 496 | 614 | 307 | 465 | 519 | 301 | |||||||||||||||||||||||
71 | 3 | 6 | 4 | 2 | 4 | 4 | 3 | |||||||||||||||||||||||
5,005 | 948 | (350 | ) | 825 | 37 | 636 | 2,302 | 3,314 | ||||||||||||||||||||||
(8,343 | ) | (552 | ) | (1,162 | ) | (13 | ) | (2,233 | ) | (516 | ) | (1,911 | ) | 334 | ||||||||||||||||
| | 391 | | | | | 2,607 | |||||||||||||||||||||||
(8,343 | ) | (552 | ) | (771 | ) | (13 | ) | (2,233 | ) | (516 | ) | (1,911 | ) | 2,941 | ||||||||||||||||
36,783 | 4,214 | 31,307 | 22,970 | 18,893 | 12,472 | 25,100 | 2,261 | |||||||||||||||||||||||
$ | 33,445 | $ | 4,610 | $ | 30,186 | $ | 23,782 | $ | 16,697 | $ | 12,592 | $ | 25,491 | $ | 8,516 | |||||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Operations
5
Statements of Changes in Net Assets
Northwestern Mutual Variable Life Account
(in thousands)
Growth Stock Division |
Focused Appreciation Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | 1,023 | $ | 1,713 | $ | (375 | ) | $ | (303 | ) | ||||||
Net realized gains (losses) |
(2,545 | ) | (5,105 | ) | 263 | (678 | ) | |||||||||
Net change in unrealized appreciation/ depreciation |
31,797 | 78,579 | 7,977 | 26,775 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
30,275 | 75,187 | 7,865 | 25,794 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
23,120 | 26,445 | 8,658 | 8,380 | ||||||||||||
Policy loans, surrenders and death benefits |
(25,375 | ) | (15,891 | ) | (8,371 | ) | (6,942 | ) | ||||||||
Mortality and other (net) |
(7,279 | ) | (8,044 | ) | (2,520 | ) | (2,628 | ) | ||||||||
Transfers from other divisions |
34,677 | 15,890 | 19,667 | 18,714 | ||||||||||||
Transfers to other divisions |
(41,784 | ) | (17,336 | ) | (15,264 | ) | (14,625 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
(16,641 | ) | 1,064 | 2,170 | 2,899 | |||||||||||
Net increase (decrease) in net assets |
13,634 | 76,251 | 10,035 | 28,693 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
275,067 | 198,816 | 87,828 | 59,135 | ||||||||||||
End of period |
$ | 288,701 | $ | 275,067 | $ | 97,863 | $ | 87,828 | ||||||||
Units issued during the period |
16,675 | 21,331 | 11,635 | 14,596 | ||||||||||||
Units redeemed during the period |
(21,336 | ) | (22,754 | ) | (11,029 | ) | (12,408 | ) | ||||||||
Net units issued (redeemed) during period |
(4,661 | ) | (1,423 | ) | 606 | 2,188 | ||||||||||
Mid Cap Growth Stock Division |
Index 400 Stock Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | (630 | ) | $ | (505 | ) | $ | 1,232 | $ | 2,094 | ||||||
Net realized gains (losses) |
(9,482 | ) | (11,271 | ) | 731 | 2,365 | ||||||||||
Net change in unrealized appreciation/ depreciation |
87,530 | 96,475 | 41,347 | 44,192 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
77,418 | 84,699 | 43,310 | 48,651 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
28,654 | 32,786 | 14,339 | 16,167 | ||||||||||||
Policy loans, surrenders and death benefits |
(33,072 | ) | (25,144 | ) | (17,053 | ) | (11,985 | ) | ||||||||
Mortality and other (net) |
(10,140 | ) | (9,844 | ) | (4,990 | ) | (5,033 | ) | ||||||||
Transfers from other divisions |
13,707 | 14,572 | 13,812 | 10,778 | ||||||||||||
Transfers to other divisions |
(21,347 | ) | (17,344 | ) | (18,442 | ) | (15,433 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
(22,198 | ) | (4,974 | ) | (12,334 | ) | (5,506 | ) | ||||||||
Net increase (decrease) in net assets |
55,220 | 79,725 | 30,976 | 43,145 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
348,854 | 269,129 | 177,545 | 134,400 | ||||||||||||
End of period |
$ | 404,074 | $ | 348,854 | $ | 208,521 | $ | 177,545 | ||||||||
Units issued during the period |
17,240 | 24,197 | 13,194 | 17,990 | ||||||||||||
Units redeemed during the period |
(24,850 | ) | (26,722 | ) | (17,376 | ) | (20,353 | ) | ||||||||
Net units issued (redeemed) during period |
(7,610 | ) | (2,525 | ) | (4,182 | ) | (2,363 | ) | ||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
6
Statements of Changes in Net Assets
Large Cap Core Stock Division |
Index 500 Stock Division |
Domestic Equity Division |
Equity Income Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 1,334 | $ | 2,159 | $ | 10,422 | $ | 13,360 | $ | 2,257 | $ | 3,061 | $ | 830 | $ | 1,284 | |||||||||||||||
(4,215 | ) | (5,497 | ) | (4,874 | ) | 1,397 | (2,430 | ) | (2,436 | ) | (1,589 | ) | (1,799 | ) | ||||||||||||||||
24,055 | 43,709 | 87,360 | 121,808 | 16,855 | 26,412 | 10,104 | 12,873 | |||||||||||||||||||||||
21,174 | 40,371 | 92,908 | 136,565 | 16,682 | 27,037 | 9,345 | 12,358 | |||||||||||||||||||||||
16,425 | 18,357 | 57,023 | 63,278 | 12,739 | 13,892 | 5,885 | 6,281 | |||||||||||||||||||||||
(17,828 | ) | (12,684 | ) | (58,092 | ) | (49,959 | ) | (11,192 | ) | (7,976 | ) | (5,900 | ) | (4,531 | ) | |||||||||||||||
(4,893 | ) | (5,325 | ) | (18,730 | ) | (19,116 | ) | (3,368 | ) | (3,426 | ) | (1,790 | ) | (1,667 | ) | |||||||||||||||
17,200 | 14,344 | 78,450 | 38,264 | 12,165 | 9,926 | 13,421 | 9,838 | |||||||||||||||||||||||
(17,037 | ) | (15,344 | ) | (75,786 | ) | (39,587 | ) | (12,333 | ) | (10,822 | ) | (8,693 | ) | (6,917 | ) | |||||||||||||||
(6,133 | ) | (652 | ) | (17,135 | ) | (7,120 | ) | (1,989 | ) | 1,594 | 2,923 | 3,004 | ||||||||||||||||||
15,041 | 39,719 | 75,773 | 129,445 | 14,693 | 28,631 | 12,268 | 15,362 | |||||||||||||||||||||||
177,955 | 138,236 | 655,118 | 525,673 | 119,939 | 91,308 | 61,572 | 46,210 | |||||||||||||||||||||||
$ | 192,996 | $ | 177,955 | $ | 730,891 | $ | 655,118 | $ | 134,632 | $ | 119,939 | $ | 73,840 | $ | 61,572 | |||||||||||||||
13,698 | 18,085 | 35,185 | 46,549 | 18,344 | 24,059 | 10,630 | 12,506 | |||||||||||||||||||||||
(16,697 | ) | (19,256 | ) | (42,103 | ) | (48,585 | ) | (18,787 | ) | (22,203 | ) | (8,664 | ) | (10,053 | ) | |||||||||||||||
(2,999 | ) | (1,171 | ) | (6,918 | ) | (2,036 | ) | (443 | ) | 1,856 | 1,966 | 2,453 | ||||||||||||||||||
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 345 | $ | 203 | $ | 550 | $ | (200 | ) | $ | 834 | $ | 439 | $ | 425 | $ | 166 | ||||||||||||||
(2,078 | ) | (2,307 | ) | (3,440 | ) | (7,560 | ) | 2,044 | 4,101 | (2,650 | ) | (3,032 | ) | |||||||||||||||||
8,178 | 8,079 | 43,682 | 47,360 | 22,606 | 22,271 | 15,011 | 16,621 | |||||||||||||||||||||||
6,445 | 5,975 | 40,792 | 39,600 | 25,484 | 26,811 | 12,786 | 13,755 | |||||||||||||||||||||||
3,548 | 3,823 | 16,158 | 18,114 | 11,182 | 12,433 | 8,726 | 9,603 | |||||||||||||||||||||||
(3,608 | ) | (2,264 | ) | (17,623 | ) | (14,215 | ) | (11,199 | ) | (9,260 | ) | (8,176 | ) | (5,674 | ) | |||||||||||||||
(1,052 | ) | (984 | ) | (4,903 | ) | (4,888 | ) | (3,644 | ) | (3,617 | ) | (2,311 | ) | (2,314 | ) | |||||||||||||||
22,432 | 4,520 | 27,102 | 20,416 | 19,361 | 12,950 | 42,439 | 11,030 | |||||||||||||||||||||||
(19,751 | ) | (4,711 | ) | (26,756 | ) | (21,580 | ) | (19,225 | ) | (14,624 | ) | (35,251 | ) | (11,229 | ) | |||||||||||||||
1,569 | 384 | (6,022 | ) | (2,153 | ) | (3,525 | ) | (2,118 | ) | 5,427 | 1,416 | |||||||||||||||||||
8,014 | 6,359 | 34,770 | 37,447 | 21,959 | 24,693 | 18,213 | 15,171 | |||||||||||||||||||||||
31,825 | 25,466 | 166,342 | 128,895 | 122,050 | 97,357 | 76,761 | 61,590 | |||||||||||||||||||||||
$ | 39,839 | $ | 31,825 | $ | 201,112 | $ | 166,342 | $ | 144,009 | $ | 122,050 | $ | 94,974 | $ | 76,761 | |||||||||||||||
6,141 | 5,901 | 14,559 | 20,471 | 11,528 | 15,421 | 15,822 | 15,210 | |||||||||||||||||||||||
(5,802 | ) | (5,599 | ) | (17,602 | ) | (21,800 | ) | (12,778 | ) | (16,262 | ) | (13,844 | ) | (14,371 | ) | |||||||||||||||
339 | 302 | (3,043 | ) | (1,329 | ) | (1,250 | ) | (841 | ) | 1,978 | 839 | |||||||||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Changes in Net Assets
7
Statements of Changes in Net Assets
Northwestern Mutual Variable Life Account
(in thousands)
International Equity Division | Money Market Division | |||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | 11,981 | $ | 17,187 | $ | (192 | ) | $ | 654 | |||||||
Net realized gains (losses) |
(104 | ) | 6,202 | 12 | 1 | |||||||||||
Net change in unrealized appreciation/ depreciation |
21,731 | 97,116 | | | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
33,608 | 120,505 | (180 | ) | 655 | |||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
38,680 | 42,672 | 95,869 | 106,083 | ||||||||||||
Policy loans, surrenders and death benefits |
(43,462 | ) | (32,299 | ) | (63,659 | ) | (53,664 | ) | ||||||||
Mortality and other (net) |
(13,032 | ) | (14,802 | ) | (7,410 | ) | (8,938 | ) | ||||||||
Transfers from other divisions |
70,724 | 37,452 | 126,490 | 124,543 | ||||||||||||
Transfers to other divisions |
(67,040 | ) | (32,325 | ) | (170,742 | ) | (157,865 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
(14,130 | ) | 698 | (19,452 | ) | 10,159 | ||||||||||
Net increase (decrease) in net assets |
19,478 | 121,203 | (19,632 | ) | 10,814 | |||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
489,245 | 368,042 | 188,748 | 177,934 | ||||||||||||
End of period |
$ | 508,723 | $ | 489,245 | $ | 169,116 | $ | 188,748 | ||||||||
Units issued during the period |
38,456 | 37,372 | 112,514 | 121,314 | ||||||||||||
Units redeemed during the period |
(43,028 | ) | (36,196 | ) | (121,911 | ) | (119,541 | ) | ||||||||
Net units issued (redeemed) during period |
(4,572 | ) | 1,176 | (9,397 | ) | 1,773 | ||||||||||
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | (350 | ) | $ | 44 | $ | 825 | $ | 1,328 | |||||||
Net realized gains (losses) |
(771 | ) | (2,185 | ) | (13 | ) | (4,646 | ) | ||||||||
Net change in unrealized appreciation/ depreciation |
31,307 | 31,097 | 22,970 | 41,785 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
30,186 | 28,956 | 23,782 | 38,467 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
10,250 | 10,937 | 13,002 | 15,320 | ||||||||||||
Policy loans, surrenders and death benefits |
(10,880 | ) | (6,273 | ) | (13,998 | ) | (12,051 | ) | ||||||||
Mortality and other (net) |
(3,658 | ) | (3,224 | ) | (4,447 | ) | (4,711 | ) | ||||||||
Transfers from other divisions |
36,589 | 14,658 | 22,938 | 67,051 | ||||||||||||
Transfers to other divisions |
(27,176 | ) | (11,938 | ) | (29,231 | ) | (70,621 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
5,125 | 4,160 | (11,736 | ) | (5,012 | ) | ||||||||||
Net increase (decrease) in net assets |
35,311 | 33,116 | 12,046 | 33,455 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
105,355 | 72,239 | 161,462 | 128,007 | ||||||||||||
End of period |
$ | 140,666 | $ | 105,355 | $ | 173,508 | $ | 161,462 | ||||||||
Units issued during the period |
10,845 | 11,830 | 28,038 | 42,139 | ||||||||||||
Units redeemed during the period |
(9,673 | ) | (9,821 | ) | (37,957 | ) | (44,493 | ) | ||||||||
Net units issued (redeemed) during period |
1,172 | 2,009 | (9,919 | ) | (2,354 | ) | ||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
8
Statements of Changes in Net Assets
Select Bond Division | High Yield Bond Division | Balanced Division | Asset Allocation Division | |||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 7,911 | $ | 9,817 | $ | 5,913 | $ | 6,056 | $ | 5,005 | $ | 11,082 | $ | 948 | $ | 841 | |||||||||||||||
1,784 | 651 | 965 | (53 | ) | (8,343 | ) | (11,202 | ) | (552 | ) | (1,064 | ) | ||||||||||||||||||
4,063 | 7,342 | 4,752 | 19,567 | 36,783 | 52,539 | 4,214 | 7,965 | |||||||||||||||||||||||
13,758 | 17,810 | 11,630 | 25,570 | 33,445 | 52,419 | 4,610 | 7,742 | |||||||||||||||||||||||
17,938 | 18,551 | 5,907 | 6,167 | 21,634 | 22,112 | 2,842 | 3,168 | |||||||||||||||||||||||
(28,609 | ) | (19,175 | ) | (9,199 | ) | (5,595 | ) | (22,250 | ) | (19,889 | ) | (4,027 | ) | (3,159 | ) | |||||||||||||||
(6,029 | ) | (7,285 | ) | (2,538 | ) | (2,459 | ) | (8,557 | ) | (8,680 | ) | (1,123 | ) | (1,123 | ) | |||||||||||||||
60,450 | 61,681 | 15,844 | 16,685 | 13,278 | 12,282 | 3,993 | 5,096 | |||||||||||||||||||||||
(42,155 | ) | (39,230 | ) | (13,535 | ) | (11,299 | ) | (13,315 | ) | (14,051 | ) | (2,780 | ) | (3,328 | ) | |||||||||||||||
1,595 | 14,542 | (3,521 | ) | 3,499 | (9,210 | ) | (8,226 | ) | (1,095 | ) | 654 | |||||||||||||||||||
15,353 | 32,352 | 8,109 | 29,069 | 24,235 | 44,193 | 3,515 | 8,396 | |||||||||||||||||||||||
223,452 | 191,100 | 84,272 | 55,203 | 299,014 | 254,821 | 37,345 | 28,949 | |||||||||||||||||||||||
$ | 238,805 | $ | 223,452 | $ | 92,381 | $ | 84,272 | $ | 323,249 | $ | 299,014 | $ | 40,860 | $ | 37,345 | |||||||||||||||
21,882 | 26,321 | 6,977 | 9,817 | 10,022 | 12,984 | 5,079 | 6,464 | |||||||||||||||||||||||
(21,931 | ) | (20,798 | ) | (7,946 | ) | (8,658 | ) | (12,085 | ) | (14,735 | ) | (5,733 | ) | (6,463 | ) | |||||||||||||||
(49 | ) | 5,523 | (969 | ) | 1,159 | (2,063 | ) | (1,751 | ) | (654 | ) | 1 | ||||||||||||||||||
Russell Aggressive Equity Division |
Russell Non-US Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 37 | $ | 70 | $ | 636 | $ | 2,694 | $ | 2,302 | $ | 3,707 | $ | 3,314 | $ | 3,301 | |||||||||||||||
(2,233 | ) | (2,180 | ) | (516 | ) | (1,670 | ) | (1,911 | ) | (4,264 | ) | 2,941 | (44 | ) | ||||||||||||||||
18,893 | 18,956 | 12,472 | 25,120 | 25,100 | 26,150 | 2,261 | 7,467 | |||||||||||||||||||||||
16,697 | 16,846 | 12,592 | 26,144 | 25,491 | 25,593 | 8,516 | 10,724 | |||||||||||||||||||||||
6,862 | 7,866 | 10,391 | 12,178 | 10,990 | 11,966 | 5,744 | 6,235 | |||||||||||||||||||||||
(6,989 | ) | (5,417 | ) | (10,726 | ) | (8,973 | ) | (12,273 | ) | (7,970 | ) | (9,825 | ) | (5,821 | ) | |||||||||||||||
(2,134 | ) | (2,128 | ) | (3,289 | ) | (3,679 | ) | (3,591 | ) | (2,979 | ) | (2,329 | ) | (2,415 | ) | |||||||||||||||
9,527 | 13,006 | 19,087 | 40,245 | 31,929 | 31,672 | 46,009 | 73,600 | |||||||||||||||||||||||
(9,845 | ) | (13,500 | ) | (20,573 | ) | (44,630 | ) | (26,714 | ) | (30,354 | ) | (36,378 | ) | (60,658 | ) | |||||||||||||||
(2,579 | ) | (173 | ) | (5,110 | ) | (4,859 | ) | 341 | 2,335 | 3,221 | 10,941 | |||||||||||||||||||
14,118 | 16,673 | 7,482 | 21,285 | 25,832 | 27,928 | 11,737 | 21,665 | |||||||||||||||||||||||
71,135 | 54,462 | 124,379 | 103,094 | 113,878 | 85,950 | 86,412 | 64,747 | |||||||||||||||||||||||
$ | 85,253 | $ | 71,135 | $ | 131,861 | $ | 124,379 | $ | 139,710 | $ | 113,878 | $ | 98,149 | $ | 86,412 | |||||||||||||||
10,147 | 13,102 | 16,644 | 21,650 | 9,674 | 12,614 | 13,823 | 15,373 | |||||||||||||||||||||||
(11,139 | ) | (13,059 | ) | (19,400 | ) | (23,210 | ) | (9,091 | ) | (11,143 | ) | (12,275 | ) | (13,797 | ) | |||||||||||||||
(992 | ) | 43 | (2,756 | ) | (1,560 | ) | 583 | 1,471 | 1,548 | 1,576 | ||||||||||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Changes in Net Assets
9
Northwestern Mutual Variable Life Account
December 31, 2010
1. Organization Northwestern Mutual Variable Life Account (the Account) is registered as a unit investment trust under the Investment Company Act of 1940 and is a segregated asset account of The Northwestern Mutual Life Insurance Company (Northwestern Mutual) used to fund variable life insurance policies.
All assets of each Division of the Account are invested in shares of the corresponding Portfolio of Northwestern Mutual Series Fund, Inc., Fidelity Variable Insurance Products and the Russell Investment Funds (collectively known as the Funds). The Funds are open-end investment companies registered under the Investment Company Act of 1940.
2. Significant Accounting Policies
A. | Use of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
B. | Investment Valuation The shares are valued at the Funds offering and redemption prices per share. As of December 31, 2010, all of the Accounts investments are identified as Level 1 securities for valuation purposes under the Fair Value Measurements and Disclosures Topic of the FASB Accounting Standards Codification. Level 1 securities are valued at fair value as determined by quoted prices in active markets for identical securities. |
C. | Investment Income, Securities Transactions and Policy Dividends Transactions in the Funds shares are accounted for on the trade date. The basis for determining cost on sale of the Funds shares is identified cost. Dividend income and distributions of net realized gains from the Funds are recorded on the exdate of the dividends. Dividends and distributions received are reinvested in additional shares of the respective portfolios of the Funds. The policies are eligible to receive policy dividends from Northwestern Mutual. Any policy dividends reinvested in the Account are reflected in Policyowners net payments in the accompanying financial statements. |
D. | Taxes Northwestern Mutual is taxed as a life insurance company under the Internal Revenue Code. The variable life insurance policies, which are funded in the Account, are taxed as part of the operations of Northwestern Mutual. Policies provide that a charge for taxes may be made against the assets of the Account. Generally, for Variable Life policies issued before October 11, 1995, Northwestern Mutual charges the Account at an annual rate of 0.05% of the Accounts net assets and reserves the right to increase, decrease or eliminate the charge for taxes in the future. Generally, for Variable CompLife policies issued on or after October 11, 1995, Variable Executive Life policies issued on or after March 2, 1998, and Variable Joint Life policies issued on or after December 10, 1998, there is no charge being made against the assets of the Account for federal income taxes, but Northwestern Mutual reserves the right to charge for taxes in the future. |
E. | Premium Payments For Variable Life and Variable CompLife policies, the Account is credited for the policyowners net annual premiums at the respective policy anniversary dates regardless of when policyowners actually pay their premiums. Northwestern Mutuals equity represents any unpaid portion of net annual premiums. |
3. Purchases and Sales of Investments Purchases and sales of the Funds shares for the year ended December 31, 2010 were as follows: (in thousands)
Division |
Purchases | Sales | ||||||
Growth Stock |
$ | 13,338 | $ | 28,889 | ||||
Focused Appreciation |
11,710 | 9,923 | ||||||
Large Cap Core Stock |
15,377 | 20,101 | ||||||
Index 500 Stock |
64,825 | 66,434 | ||||||
Domestic Equity |
13,529 | 13,291 | ||||||
Equity Income |
10,624 | 6,854 | ||||||
Mid Cap Growth Stock |
14,721 | 37,521 | ||||||
Index 400 Stock |
9,088 | 19,518 | ||||||
Mid Cap Value |
6,019 | 4,101 | ||||||
Small Cap Growth Stock |
14,782 | 20,253 | ||||||
Small Cap Value |
10,450 | 13,227 | ||||||
International Growth |
15,492 | 9,655 | ||||||
International Equity |
47,546 | 49,992 | ||||||
Money Market |
51,820 | 71,492 | ||||||
Select Bond |
42,694 | 32,620 | ||||||
High Yield Bond |
12,948 | 10,625 | ||||||
Balanced |
21,391 | 25,559 | ||||||
Asset Allocation |
4,403 | 4,549 | ||||||
Fidelity VIP Mid Cap |
18,136 | 12,998 | ||||||
Russell Multi-Style Equity |
6,175 | 17,157 | ||||||
Russell Aggressive Equity |
5,854 | 8,396 | ||||||
Russell Non-U.S. |
8,459 | 12,948 | ||||||
Russell Real Estate Securities |
17,172 | 14,567 | ||||||
Russell Core Bond |
20,364 | 11,439 |
10
Notes to Financial Statements
Notes to Financial Statements
4. Expenses and Related Party Transactions A deduction for mortality and expense risks is paid to Northwestern Mutual. The mortality risk is that insureds may not live as long as estimated. The expense risk is that expenses of issuing and administering the policies may exceed the estimated costs.
For Variable Life and Variable CompLife policies, the deduction is determined daily at an annual rate of 0.50% and 0.45%, respectively, of the net assets of the Account.
A deduction for the mortality and expense risks for Variable Executive Life policies is determined monthly at an annual rate of 0.60% of the amount invested in the Account for the Policy for the first ten Policy years, and 0.17% thereafter for policies with the Cash Value Amendment, or 0.15% thereafter for policies without the Cash Value Amendment. A deduction for the mortality and expense risks for Variable Joint Life policies is determined monthly at an annual rate of 0.10% of the amounts invested in the Account for the Policy. These charges are reflected as a reduction in units and are included in Mortality and Other in the accompanying financial statements.
Additional mortality costs are deducted from the policy annually for Variable Life and Variable CompLife policies, and monthly for Variable Executive Life and Variable Joint Life policies, and are paid to Northwestern Mutual to cover the cost of providing insurance protection. For Variable Life and Variable CompLife policies this cost is actuarially calculated based upon the insureds age, the 1980 Commissioners Standard Ordinary Mortality Table and the amount of insurance provided under the policy. For Variable Executive Life and Variable Joint Life policies the cost reflects expected mortality costs based upon actual experience.
Certain deductions are also made from the annual, single or other premiums before amounts are allocated to the Account. These deductions are for sales load, administrative expenses, taxes and a risk charge for the guaranteed minimum death benefit.
5. Subsequent Events No events have occurred subsequent to December 31, 2010 that require disclosure or adjustment to the financial statements at that date or through the date of issuance.
6. Financial Highlights
(For a unit outstanding during the period)
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value, Lowest to Highest |
Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return Lowest to Highest (1) |
||||||||||||||||||
Growth Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
101,987 | $ 2.434967 to $ 32.998214 | $ | 288,701 | 0.82% | 0.10% to 0.60% | 11.76% to 12.37% | |||||||||||||||||
Year Ended 12/31/09 |
106,648 | $ 2.176678 to $ 29.365924 | $ | 275,067 | 1.16% | 0.10% to 0.60% | 36.42% to 37.17% | |||||||||||||||||
Year Ended 12/31/08 |
108,071 | $ 1.594004 to $ 21.408736 | $ | 198,816 | 1.06% | 0.10% to 0.60% | (39.19%) to (38.86%) | |||||||||||||||||
Year Ended 12/31/07 |
109,301 | $ 2.618873 to $ 35.015115 | $ | 338,683 | 0.89% | 0.10% to 0.60% | 8.60% to 9.20% | |||||||||||||||||
Year Ended 12/31/06 |
112,452 | $ 2.409175 to $ 32.066403 | $ | 318,840 | 0.75% | 0.10% to 0.60% | 8.97% to 9.57% | |||||||||||||||||
Focused Appreciation |
||||||||||||||||||||||||
Year Ended 12/31/10 |
41,221 | $ 2.008299 to $ 20.869750 | $ | 97,863 | 0.00% | 0.10% to 0.60% | 8.73% to 9.33% | |||||||||||||||||
Year Ended 12/31/09 |
40,615 | $ 1.845162 to $ 19.088595 | $ | 87,828 | 0.00% | 0.10% to 0.60% | 41.70% to 42.47% | |||||||||||||||||
Year Ended 12/31/08 |
38,427 | $ 1.300904 to $ 13.397864 | $ | 59,135 | 0.35% | 0.10% to 0.60% | (40.34%) to (40.01%) | |||||||||||||||||
Year Ended 12/31/07 |
31,243 | $ 2.178331 to $ 22.333276 | $ | 81,274 | 0.04% | 0.10% to 0.60% | 26.14% to 26.84% | |||||||||||||||||
Year Ended 12/31/06 |
24,065 | $ 1.725184 to $ 17.607745 | $ | 48,864 | 0.42% | 0.10% to 0.60% | 4.31% to 4.88% | |||||||||||||||||
Large Cap Core Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
80,904 | $ 1.972165 to $ 26.477036 | $ | 192,996 | 1.20% | 0.10% to 0.60% | 12.29% to 12.91% | |||||||||||||||||
Year Ended 12/31/09 |
83,903 | $ 1.754516 to $ 23.449551 | $ | 177,955 | 1.84% | 0.10% to 0.60% | 28.63% to 29.33% | |||||||||||||||||
Year Ended 12/31/08 |
85,074 | $ 1.362693 to $ 18.131181 | $ | 138,236 | 1.62% | 0.10% to 0.60% | (39.08%) to (38.74%) | |||||||||||||||||
Year Ended 12/31/07 |
84,079 | $ 2.234518 to $ 29.597322 | $ | 227,645 | 1.15% | 0.10% to 0.60% | 8.52% to 9.12% | |||||||||||||||||
Year Ended 12/31/06 |
85,650 | $ 2.057029 to $ 27.123722 | $ | 212,813 | 1.06% | 0.10% to 0.60% | 10.89% to 11.49% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. |
Notes to Financial Statements
11
Notes to Financial Statements
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value, Lowest to Highest |
Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return Lowest to Highest (1) |
||||||||||||||||||
Index 500 Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
220,539 | $ 2.602259 to $ 58.583796 | $ | 730,891 | 2.02% | 0.10% to 0.60% | 14.27% to 14.89% | |||||||||||||||||
Year Ended 12/31/09 |
227,457 | $ 2.275083 to $ 50.989051 | $ | 655,118 | 2.82% | 0.10% to 0.60% | 25.71% to 26.40% | |||||||||||||||||
Year Ended 12/31/08 |
229,493 | $ 1.808068 to $ 40.340674 | $ | 525,673 | 2.26% | 0.10% to 0.60% | (37.29%) to (36.94%) | |||||||||||||||||
Year Ended 12/31/07 |
228,156 | $ 2.880226 to $ 63.972521 | $ | 836,968 | 1.62% | 0.10% to 0.60% | 4.85% to 5.43% | |||||||||||||||||
Year Ended 12/31/06 |
229,219 | $ 2.744303 to $ 60.678957 | $ | 805,187 | 1.57% | 0.10% to 0.60% | 14.99% to 15.62% | |||||||||||||||||
Domestic Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
90,355 | $ 1.241092 to $ 13.033112 | $ | 134,632 | 2.28% | 0.10% to 0.60% | 13.99% to 14.62% | |||||||||||||||||
Year Ended 12/31/09 |
90,798 | $ 1.087659 to $ 11.370681 | $ | 119,939 | 3.49% | 0.10% to 0.60% | 28.81% to 29.52% | |||||||||||||||||
Year Ended 12/31/08 |
88,942 | $ 0.843525 to $ 8.778981 | $ | 91,308 | 2.91% | 0.10% to 0.60% | (38.83%) to (38.49%) | |||||||||||||||||
Year Ended 12/31/07 |
86,124 | $ 1.377664 to $ 14.273423 | $ | 145,614 | 1.44% | 0.10% to 0.60% | (6.84%) to (6.33%) | |||||||||||||||||
Year Ended 12/31/06 |
75,043 | $ 1.477394 to $ 15.237722 | $ | 136,676 | 0.00% | 0.10% to 0.60% | 15.93% to 16.56% | |||||||||||||||||
Equity Income |
||||||||||||||||||||||||
Year Ended 12/31/10 |
38,980 | $ 1.619759 to $ 16.832155 | $ | 73,840 | 1.70% | 0.10% to 0.60% | 14.70% to 15.33% | |||||||||||||||||
Year Ended 12/31/09 |
37,014 | $ 1.410806 to $ 14.595160 | $ | 61,572 | 2.93% | 0.10% to 0.60% | 23.90% to 24.58% | |||||||||||||||||
Year Ended 12/31/08 |
34,561 | $ 1.137525 to $ 11.715261 | $ | 46,210 | 0.03% | 0.10% to 0.60% | (36.16%) to (35.81%) | |||||||||||||||||
Year Ended 12/31/07 |
30,456 | $ 1.780093 to $ 18.250431 | $ | 64,070 | 2.10% | 0.10% to 0.60% | 2.69% to 3.26% | |||||||||||||||||
Year Ended 12/31/06 |
23,010 | $ 1.731741 to $ 17.674755 | $ | 48,241 | 1.82% | 0.10% to 0.60% | 18.50% to 19.15% | |||||||||||||||||
Mid Cap Growth Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
127,814 | $ 2.625759 to $ 71.778944 | $ | 404,074 | 0.28% | 0.10% to 0.60% | 23.18% to 23.86% | |||||||||||||||||
Year Ended 12/31/09 |
135,424 | $ 2.129518 to $ 57.953082 | $ | 348,854 | 0.28% | 0.10% to 0.60% | 31.37% to 32.09%( | 2) | ||||||||||||||||
Year Ended 12/31/08 |
137,949 | $ 1.619377 to $ 43.872392 | $ | 269,129 | 0.30% | 0.10% to 0.60% | (40.41%) to (40.08%) | |||||||||||||||||
Year Ended 12/31/07 |
141,002 | $ 2.714862 to $ 73.219863 | $ | 464,301 | 0.76% | 0.10% to 0.60% | 20.04% to 20.70% | |||||||||||||||||
Year Ended 12/31/06 |
147,324 | $ 2.259482 to $ 60.663705 | $ | 404,081 | 0.12% | 0.10% to 0.60% | 3.83% to 4.40% | |||||||||||||||||
Index 400 Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
80,664 | $ 2.311836 to $ 25.934506 | $ | 208,521 | 1.09% | 0.10% to 0.60% | 25.60% to 26.29% | |||||||||||||||||
Year Ended 12/31/09 |
84,846 | $ 1.838809 to $ 20.535699 | $ | 177,545 | 1.82% | 0.10% to 0.60% | 36.25% to 37.00% | |||||||||||||||||
Year Ended 12/31/08 |
87,209 | $ 1.348229 to $ 14.989442 | $ | 134,400 | 1.54% | 0.10% to 0.60% | (36.63%) to (36.28%) | |||||||||||||||||
Year Ended 12/31/07 |
88,681 | $ 2.125280 to $ 23.522236 | $ | 218,656 | 1.23% | 0.10% to 0.60% | 7.34% to 7.93% | |||||||||||||||||
Year Ended 12/31/06 |
89,766 | $ 1.978080 to $ 21.794434 | $ | 206,352 | 1.06% | 0.10% to 0.60% | 9.44% to 10.04% | |||||||||||||||||
Mid Cap Value |
||||||||||||||||||||||||
Year Ended 12/31/10 |
19,018 | $ 1.759035 to $ 18.279525 | $ | 39,839 | 1.41% | 0.10% to 0.60% | 19.27% to 19.93% | |||||||||||||||||
Year Ended 12/31/09 |
18,679 | $ 1.473346 to $ 15.242180 | $ | 31,825 | 1.20% | 0.10% to 0.60% | 22.56% to 23.24% | |||||||||||||||||
Year Ended 12/31/08 |
18,377 | $ 1.200893 to $ 12.367958 | $ | 25,466 | 0.00% | 0.10% to 0.60% | (35.43%) to (35.07%) | |||||||||||||||||
Year Ended 12/31/07 |
18,925 | $ 1.857847 to $ 19.047672 | $ | 40,344 | 0.83% | 0.10% to 0.60% | (0.71%) to (0.16%) | |||||||||||||||||
Year Ended 12/31/06 |
12,958 | $ 1.869298 to $ 19.078717 | $ | 28,186 | 1.30% | 0.10% to 0.60% | 13.87% to 14.49% | |||||||||||||||||
Small Cap Growth Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
78,328 | $ 2.308077 to $ 29.671998 | $ | 201,112 | 0.75% | 0.10% to 0.60% | 25.16% to 25.85% | |||||||||||||||||
Year Ended 12/31/09 |
81,371 | $ 1.842237 to $ 23.577314 | $ | 166,342 | 0.28% | 0.10% to 0.60% | 30.46% to 31.17% | |||||||||||||||||
Year Ended 12/31/08 |
82,700 | $ 1.410759 to $ 17.974245 | $ | 128,895 | 0.17% | 0.10% to 0.60% | (44.18%) to (43.87%) | |||||||||||||||||
Year Ended 12/31/07 |
82,192 | $ 2.524707 to $ 32.021844 | $ | 231,752 | 0.08% | 0.10% to 0.60% | 8.94% to 9.54% | |||||||||||||||||
Year Ended 12/31/06 |
84,660 | $ 2.315230 to $ 29.232653 | $ | 220,095 | 0.00% | 0.10% to 0.60% | 6.10% to 6.68% | |||||||||||||||||
Small Cap Value |
||||||||||||||||||||||||
Year Ended 12/31/10 |
57,649 | $ 2.144514 to $ 22.519799 | $ | 144,009 | 1.09% | 0.10% to 0.60% | 21.28% to 21.95% | |||||||||||||||||
Year Ended 12/31/09 |
58,899 | $ 1.766442 to $ 18.466637 | $ | 122,050 | 0.85% | 0.10% to 0.60% | 27.48% to 28.18% | |||||||||||||||||
Year Ended 12/31/08 |
59,740 | $ 1.384260 to $ 14.406429 | $ | 97,357 | 0.34% | 0.10% to 0.60% | (28.53%) to (28.13%) | |||||||||||||||||
Year Ended 12/31/07 |
58,487 | $ 1.934849 to $ 20.045927 | $ | 135,847 | 0.41% | 0.10% to 0.60% | (1.37%) to (0.83%) | |||||||||||||||||
Year Ended 12/31/06 |
54,770 | $ 1.959847 to $ 20.213417 | $ | 131,093 | 0.23% | 0.10% to 0.60% | 15.92% to 16.55% | |||||||||||||||||
International Growth |
||||||||||||||||||||||||
Year Ended 12/31/10 |
49,762 | $ 1.592294 to $ 16.720938 | $ | 94,974 | 0.92% | 0.10% to 0.60% | 15.79% to 16.43% | |||||||||||||||||
Year Ended 12/31/09 |
47,784 | $ 1.373759 to $ 14.361577 | $ | 76,761 | 0.66% | 0.10% to 0.60% | 22.49% to 23.16% | |||||||||||||||||
Year Ended 12/31/08 |
46,945 | $ 1.120404 to $ 11.660588 | $ | 61,590 | 1.52% | 0.10% to 0.60% | (46.48%) to (46.19%) | |||||||||||||||||
Year Ended 12/31/07 |
45,016 | $ 2.091399 to $ 21.668250 | $ | 110,759 | 0.81% | 0.10% to 0.60% | 12.00% to 12.62% | |||||||||||||||||
Year Ended 12/31/06 |
36,920 | $ 1.865431 to $ 19.240066 | $ | 81,194 | 0.20% | 0.10% to 0.60% | 20.81% to 21.48% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. |
(2) | Total Return reflects the effect of a one-time class action settlement received on June 18, 2009. Absent the payment, the returns would have ranged from 31.27% to 31.99% for the Mid Cap Growth Stock Division, from 31.66% to 32.39% for the International Equity Division and from 0.06% to 0.61% for the Money Market Division. |
12
Notes to Financial Statements
Notes to Financial Statements
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value, Lowest to Highest |
Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return Lowest to Highest (1) |
||||||||||||||||||
International Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
159,931 | $ 2.718891 to $ 4.095847 | $ | 508,723 | 3.01% | 0.10% to 0.60% | 7.08% to 7.67% | |||||||||||||||||
Year Ended 12/31/09 |
164,503 | $ 2.536491 to $ 3.803991 | $ | 489,245 | 4.66% | 0.10% to 0.60% | 32.38% to 33.11%( | 2) | ||||||||||||||||
Year Ended 12/31/08 |
163,327 | $ 1.914107 to $ 2.857743 | $ | 368,042 | 2.67% | 0.10% to 0.60% | (44.09%) to (43.78%) | |||||||||||||||||
Year Ended 12/31/07 |
163,444 | $ 3.420279 to $ 5.083451 | $ | 662,096 | 1.83% | 0.10% to 0.60% | 17.42% to 18.06% | |||||||||||||||||
Year Ended 12/31/06 |
156,118 | $ 2.910111 to $ 4.305729 | $541,364 | 1.70% | 0.10% to 0.60% | 30.18% to 30.90% | ||||||||||||||||||
Money Market |
||||||||||||||||||||||||
Year Ended 12/31/10 |
86,934 | $1.559508 to $ 41.380226 | $169,116 | 0.29% | 0.10% to 0.60% | (0.25%) to 0.29% | ||||||||||||||||||
Year Ended 12/31/09 |
96,331 | $1.561917 to $ 41.258586 | $188,748 | 0.75% | 0.10% to 0.60% | 0.21% to 0.76%( | 2) | |||||||||||||||||
Year Ended 12/31/08 |
94,558 | $1.557129 to $ 40.947848 | $177,934 | 2.65% | 0.10% to 0.60% | 2.20% to 2.76% | ||||||||||||||||||
Year Ended 12/31/07 |
77,291 | $1.522145 to $ 39.847990 | $142,948 | 5.13% | 0.10% to 0.60% | 4.70% to 5.28% | ||||||||||||||||||
Year Ended 12/31/06 |
74,505 | $1.452309 to $ 37.848488 | $131,778 | 4.74% | 0.10% to 0.60% | 4.29% to 4.86% | ||||||||||||||||||
Select Bond |
||||||||||||||||||||||||
Year Ended 12/31/10 |
78,164 | $2.341027 to $181.992325 | $238,805 | 3.75% | 0.10% to 0.60% | 6.00% to 6.59% | ||||||||||||||||||
Year Ended 12/31/09 |
78,213 | $2.206231 to $170.745431 | $223,452 | 5.05% | 0.10% to 0.60% | 8.77% to 9.37% | ||||||||||||||||||
Year Ended 12/31/08 |
72,690 | $2.026282 to $156.116892 | $191,100 | 4.60% | 0.10% to 0.60% | 2.69% to 3.26% | ||||||||||||||||||
Year Ended 12/31/07 |
61,706 | $1.971244 to $151.194364 | $164,709 | 3.96% | 0.10% to 0.60% | 5.81% to 6.39% | ||||||||||||||||||
Year Ended 12/31/06 |
54,043 | $1.861181 to $142.110273 | $134,698 | 3.64% | 0.10% to 0.60% | 3.18% to 3.74% | ||||||||||||||||||
High Yield Bond |
||||||||||||||||||||||||
Year Ended 12/31/10 |
29,475 | $2.662698 to $ 34.475967 | $ 92,381 | 7.13% | 0.10% to 0.60% | 13.93% to 14.56% | ||||||||||||||||||
Year Ended 12/31/09 |
30,444 | $2.334783 to $ 30.094875 | $ 84,272 | 8.96% | 0.10% to 0.60% | 44.60% to 45.39% | ||||||||||||||||||
Year Ended 12/31/08 |
29,285 | $1.613065 to $ 20.699102 | $ 55,203 | 8.18% | 0.10% to 0.60% | (21.78%) to (21.35%) | ||||||||||||||||||
Year Ended 12/31/07 |
29,659 | $2.060165 to $ 26.317469 | $ 72,398 | 6.14% | 0.10% to 0.60% | 1.82% to 2.38% | ||||||||||||||||||
Year Ended 12/31/06 |
28,367 | $2.021433 to $ 25.706496 | $ 68,410 | 6.61% | 0.10% to 0.60% | 9.18% to 9.77% | ||||||||||||||||||
Balanced |
||||||||||||||||||||||||
Year Ended 12/31/10 |
63,195 | $2.557927 to $137.200077 | $323,249 | 2.12% | 0.10% to 0.60% | 11.34% to 11.96% | ||||||||||||||||||
Year Ended 12/31/09 |
65,258 | $2.295052 to $122.549243 | $299,014 | 4.56% | 0.10% to 0.60% | 20.77% to 21.43% | ||||||||||||||||||
Year Ended 12/31/08 |
67,009 | $1.898456 to $100.918470 | $254,821 | 1.30% | 0.10% to 0.60% | (23.15%) to (22.72%) | ||||||||||||||||||
Year Ended 12/31/07 |
66,343 | $2.467848 to $130.596514 | $339,847 | 3.04% | 0.10% to 0.60% | 5.57% to 6.15% | ||||||||||||||||||
Year Ended 12/31/06 |
67,095 | $2.335417 to $123.031604 | $327,176 | 2.81% | 0.10% to 0.60% | 9.82% to 10.42% | ||||||||||||||||||
Asset Allocation |
||||||||||||||||||||||||
Year Ended 12/31/10 |
22,865 | $1.433617 to $ 15.054442 | $ 40,860 | 2.92% | 0.10% to 0.60% | 12.39% to 13.01% | ||||||||||||||||||
Year Ended 12/31/09 |
23,519 | $1.274289 to $ 13.321541 | $ 37,345 | 3.04% | 0.10% to 0.60% | 26.40% to 27.09% | ||||||||||||||||||
Year Ended 12/31/08 |
23,518 | $1.007179 to $ 10.482012 | $ 28,949 | 2.95% | 0.10% to 0.60% | (30.51%) to (30.13%) | ||||||||||||||||||
Year Ended 12/31/07 |
22,548 | $1.447923 to $ 15.001132 | $ 40,176 | 2.21% | 0.10% to 0.60% | 8.80% to 9.40% | ||||||||||||||||||
Year Ended 12/31/06 |
21,975 | $1.329516 to $ 13.712349 | $ 36,382 | 1.83% | 0.10% to 0.60% | 9.32% to 9.91% | ||||||||||||||||||
Fidelity VIP Mid Cap |
||||||||||||||||||||||||
Year Ended 12/31/10 |
41,434 | $2.801620 to $ 29.113348 | $140,666 | 0.13% | 0.10% to 0.60% | 27.87% to 28.57% | ||||||||||||||||||
Year Ended 12/31/09 |
40,262 | $2.188843 to $ 22.643898 | $105,355 | 0.47% | 0.10% to 0.60% | 38.99% to 39.75% | ||||||||||||||||||
Year Ended 12/31/08 |
38,253 | $1.573285 to $ 16.202990 | $ 72,239 | 0.24% | 0.10% to 0.60% | (39.94%) to (39.61%) | ||||||||||||||||||
Year Ended 12/31/07 |
35,107 | $2.616815 to $ 26.828755 | $111,532 | 0.49% | 0.10% to 0.60% | 14.71% to 15.34% | ||||||||||||||||||
Year Ended 12/31/06 |
30,673 | $2.279082 to $ 23.260937 | $ 84,535 | 0.15% | 0.10% to 0.60% | 11.79% to 12.40% | ||||||||||||||||||
Russell Multi-Style Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
145,784 | $0.975990 to $ 10.686543 | $173,508 | 0.91% | 0.10% to 0.60% | 15.82% to 16.46% | ||||||||||||||||||
Year Ended 12/31/09 |
155,703 | $0.841815 to $ 9.176223 | $161,462 | 1.34% | 0.10% to 0.60% | 30.68% to 31.40% | ||||||||||||||||||
Year Ended 12/31/08 |
158,057 | $0.643528 to $ 6.983334 | $128,007 | 1.44% | 0.10% to 0.60% | (40.89%) to (40.56%) | ||||||||||||||||||
Year Ended 12/31/07 |
155,372 | $1.087639 to $ 11.749485 | $205,482 | 0.97% | 0.10% to 0.60% | 9.76% to 10.36% | ||||||||||||||||||
Year Ended 12/31/06 |
150,286 | $0.989999 to $ 10.646608 | $181,626 | 0.94% | 0.10% to 0.60% | 12.13% to 12.75% | ||||||||||||||||||
Russell Aggressive Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
48,091 | $1.531783 to $ 17.202203 | $ 85,253 | 0.47% | 0.10% to 0.60% | 24.20% to 24.88% | ||||||||||||||||||
Year Ended 12/31/09 |
49,083 | $1.232123 to $ 13.775086 | $ 71,135 | 0.53% | 0.10% to 0.60% | 30.68% to 31.39% | ||||||||||||||||||
Year Ended 12/31/08 |
49,040 | $0.941939 to $ 10.483725 | $ 54,462 | 0.87% | 0.10% to 0.60% | (43.23%) to (42.92%) | ||||||||||||||||||
Year Ended 12/31/07 |
49,732 | $1.657613 to $ 18.365962 | $ 98,737 | 0.37% | 0.10% to 0.60% | 2.85% to 3.42% | ||||||||||||||||||
Year Ended 12/31/06 |
49,892 | $1.610065 to $ 17.758799 | $ 96,874 | 0.19% | 0.10% to 0.60% | 14.16% to 14.79% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. |
(2) | Total Return reflects the effect of a one-time class action settlement received on June 18, 2009. Absent the payment, the returns would have ranged from 31.27% to 31.99% for the Mid Cap Growth Stock Division, from 31.66% to 32.39% for the International Equity Division and from 0.06% to 0.61% for the Money Market Division. |
Notes to Financial Statements
13
Notes to Financial Statements
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value, Lowest to Highest |
Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return Lowest to Highest (1) |
||||||||||||||||||
Russell Non-U.S. |
||||||||||||||||||||||||
Year Ended 12/31/10 |
77,992 | $1.368210 to $ 14.635995 | $131,861 | 0.93% | 0.10% to 0.60% | 10.81% to 11.42% | ||||||||||||||||||
Year Ended 12/31/09 |
80,748 | $1.233456 to $ 13.135524 | $124,379 | 2.86% | 0.10% to 0.60% | 25.80% to 26.49% | ||||||||||||||||||
Year Ended 12/31/08 |
82,308 | $0.979547 to $ 10.384851 | $103,094 | 0.00% | 0.10% to 0.60% | (42.73%) to (42.41%) | ||||||||||||||||||
Year Ended 12/31/07 |
83,679 | $1.708615 to $ 18.032632 | $180,770 | 2.59% | 0.10% to 0.60% | 9.52% to 10.12% | ||||||||||||||||||
Year Ended 12/31/06 |
80,347 | $1.558635 to $ 16.375774 | $158,005 | 2.54% | 0.10% to 0.60% | 22.97% to 23.64% | ||||||||||||||||||
Russell Real Estate Securities |
||||||||||||||||||||||||
Year Ended 12/31/10 |
39,697 | $3.023867 to $ 31.671345 | $139,710 | 2.23% | 0.10% to 0.60% | 22.25% to 22.92% | ||||||||||||||||||
Year Ended 12/31/09 |
39,114 | $2.471078 to $ 25.765834 | $113,878 | 4.65% | 0.10% to 0.60% | 28.24% to 28.94% | ||||||||||||||||||
Year Ended 12/31/08 |
37,643 | $1.925035 to $ 19.982226 | $ 85,950 | 1.92% | 0.10% to 0.60% | (37.03%) to (36.68%) | ||||||||||||||||||
Year Ended 12/31/07 |
36,447 | $3.054156 to $ 31.559603 | $131,195 | 2.29% | 0.10% to 0.60% | (16.32%) to (15.86%) | ||||||||||||||||||
Year Ended 12/31/06 |
38,227 | $3.646143 to $ 37.506853 | $165,271 | 1.96% | 0.10% to 0.60% | 35.10% to 35.84% | ||||||||||||||||||
Russell Core Bond |
||||||||||||||||||||||||
Year Ended 12/31/10 |
34,612 | $1.882787 to $ 19.746605 | $ 98,149 | 3.79% | 0.10% to 0.60% | 9.42% to 10.02% | ||||||||||||||||||
Year Ended 12/31/09 |
33,064 | $1.719005 to $ 17.948158 | $ 86,412 | 4.70% | 0.10% to 0.60% | 15.18% to 15.81% | ||||||||||||||||||
Year Ended 12/31/08 |
31,488 | $1.490991 to $ 15.497865 | $ 64,747 | 4.06% | 0.10% to 0.60% | (4.09%) to (3.57%) | ||||||||||||||||||
Year Ended 12/31/07 |
27,869 | $1.553099 to $ 16.070912 | $ 71,236 | 5.27% | 0.10% to 0.60% | 6.66% to 7.24% | ||||||||||||||||||
Year Ended 12/31/06 |
24,720 | $1.454770 to $ 14.985609 | $ 61,015 | 4.53% | 0.10% to 0.60% | 3.15% to 3.72% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. |
14
Notes to Financial Statements
Report of Independent Registered Public Accounting Firm
To The Northwestern Mutual Life Insurance Company and
Policyowners of Northwestern Mutual Variable Life Account
In our opinion, the accompanying statements of assets and liabilities, the related statements of operations, and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Northwestern Mutual Variable Life Account and its Growth Stock Division, Focused Appreciation Division, Large Cap Core Stock Division, Index 500 Stock Division, Domestic Equity Division, Equity Income Division, Mid Cap Growth Stock Division, Index 400 Stock Division, Mid Cap Value Division, Small Cap Growth Stock Division, Small Cap Value Division, International Growth Division, International Equity Division, Money Market Division, Select Bond Division, High Yield Bond Division, Balanced Division, Asset Allocation Division, Fidelity VIP Mid Cap Division, Russell Multi-Style Equity Division, Russell Aggressive Equity Division, Russell Non-US Division, Russell Real Estate Securities Division, and Russell Core Bond Division at December 31, 2010, and the results of each of their operations, the changes in each of their net assets and their financial highlights for the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as financial statements) are the responsibility of The Northwestern Mutual Life Insurance Companys management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included direct confirmation of securities owned at December 31, 2010 with Northwestern Mutual Series Fund, Inc., Fidelity Variable Insurance Products Fund III and the Russell Investment Funds, provide a reasonable basis for our opinion.
February 18, 2011
Report of Independent Registered Public Accounting Firm
15
Annual Report December 31, 2010
Northwestern Mutual Variable Life Account II
Financial Statements
Northwestern Mutual Variable Life Account II Financial Statements
Northwestern Mutual Variable Life Account II |
||||
1 | ||||
4 | ||||
6 | ||||
10 | ||||
14 |
Statements of Assets and Liabilities
Northwestern Mutual Variable Life Account II
December 31, 2010
(in thousands, except accumulation unit values)
Growth Stock Division |
Focused Appreciation Division |
Large Cap Core Stock Division |
Index 500 Stock Division |
Domestic Equity Division |
Equity Income Division |
Mid Cap Growth Stock Division |
||||||||||||||||||||||
Assets: |
||||||||||||||||||||||||||||
Investments, at Value (1) |
||||||||||||||||||||||||||||
Northwestern Mutual Series Fund, Inc. |
$ | 1,627 | $ | 3,505 | $ | 1,330 | $ | 4,938 | $ | 1,965 | $ | 1,944 | $ | 2,001 | ||||||||||||||
Fidelity Variable Insurance Products |
| | | | | | | |||||||||||||||||||||
Russell Investment Funds |
| | | | | | | |||||||||||||||||||||
Due from Northwestern Mutual Life Insurance Company |
1 | 11 | 1 | | 14 | | 1 | |||||||||||||||||||||
Total Assets |
1,628 | 3,516 | 1,331 | 4,938 | 1,979 | 1,944 | 2,002 | |||||||||||||||||||||
Liabilities: |
||||||||||||||||||||||||||||
Due to Northwestern Mutual Life Insurance Company |
| | | 1 | | 1 | | |||||||||||||||||||||
Due to Policyowners |
| | | | | | | |||||||||||||||||||||
Total Liabilities |
| | | 1 | | 1 | | |||||||||||||||||||||
Total Net Assets |
$ | 1,628 | $ | 3,516 | $ | 1,331 | $ | 4,937 | $ | 1,979 | $ | 1,943 | $ | 2,002 | ||||||||||||||
Net Assets: |
||||||||||||||||||||||||||||
Custom Variable Universal Life Policies Issued On or After January 31, 2007 (2) |
||||||||||||||||||||||||||||
Policyowners Equity |
$ | 1,262 | $ | 2,329 | $ | 885 | $ | 2,775 | $ | 1,894 | $ | 1,138 | $ | 934 | ||||||||||||||
Executive Variable Universal Life Policies Issued On or After January 31, 2007 (3) |
||||||||||||||||||||||||||||
Policyowners Equity |
273 | 1,114 | 403 | 2,118 | 57 | 751 | 1,031 | |||||||||||||||||||||
Survivorship Variable Universal Life Policies Issued On or After January 31, 2007 (4) |
||||||||||||||||||||||||||||
Policyowners Equity |
93 | 73 | 43 | 44 | 28 | 54 | 37 | |||||||||||||||||||||
Total Net Assets |
$ | 1,628 | $ | 3,516 | $ | 1,331 | $ | 4,937 | $ | 1,979 | $ | 1,943 | $ | 2,002 | ||||||||||||||
(1) Investments, at cost |
$ | 1,412 | $ | 2,931 | $ | 1,147 | $ | 4,079 | $ | 1,632 | $ | 1,612 | $ | 1,542 | ||||||||||||||
Mutual Fund Shares Held |
763 | 1,881 | 1,070 | 1,898 | 2,221 | 1,629 | 642 | |||||||||||||||||||||
(2) Accumulation Unit Value |
$ | 32.998214 | $ | 20.869750 | $ | 26.477036 | $ | 58.583796 | $ | 13.033112 | $ | 16.832155 | $ | 71.778944 | ||||||||||||||
Units Outstanding |
38 | 112 | 33 | 47 | 145 | 68 | 13 | |||||||||||||||||||||
(3) Accumulation Unit Value |
$ | 32.998214 | $ | 20.869750 | $ | 26.477036 | $ | 58.583796 | $ | 13.033112 | $ | 16.832155 | $ | 71.778944 | ||||||||||||||
Units Outstanding |
8 | 53 | 15 | 36 | 5 | 45 | 14 | |||||||||||||||||||||
(4) Accumulation Unit Value |
$ | 32.998214 | $ | 20.869750 | $ | 26.477036 | $ | 58.583796 | $ | 13.033112 | $ | 16.832155 | $ | 71.778944 | ||||||||||||||
Units Outstanding |
3 | 4 | 2 | 1 | 2 | 3 | 1 |
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Assets and Liabilities
1
Statements of Assets and Liabilities
Northwestern Mutual Variable Life Account II
December 31, 2010
(in thousands, except accumulation unit values)
Index 400 Stock Division |
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
International Equity Division |
Money Market |
||||||||||||||||||||||
Assets: |
||||||||||||||||||||||||||||
Investments, at Value (1) |
||||||||||||||||||||||||||||
Northwestern Mutual Series Fund, Inc. |
$ | 2,488 | $ | 780 | $ | 1,707 | $ | 2,323 | $ | 1,568 | $ | 5,929 | $ | 2,841 | ||||||||||||||
Fidelity Variable Insurance Products |
| | | | | | | |||||||||||||||||||||
Russell Investment Funds |
| | | | | | | |||||||||||||||||||||
Due from Northwestern Mutual Life Insurance Company |
| | 1 | | 7 | 8 | | |||||||||||||||||||||
Total Assets |
2,488 | 780 | 1,708 | 2,323 | 1,575 | 5,937 | 2,841 | |||||||||||||||||||||
Liabilities: |
||||||||||||||||||||||||||||
Due to Northwestern Mutual Life Insurance Company |
| 2 | | | | | 8 | |||||||||||||||||||||
Due to Policyowners |
| | | | | | 39 | |||||||||||||||||||||
Total Liabilities |
| 2 | | | | | 47 | |||||||||||||||||||||
Total Net Assets |
$ | 2,488 | $ | 778 | $ | 1,708 | $ | 2,323 | $ | 1,575 | $ | 5,937 | $ | 2,794 | ||||||||||||||
Net Assets: |
||||||||||||||||||||||||||||
Custom Variable Universal Life Policies Issued On or After January 31, 2007 (2) |
||||||||||||||||||||||||||||
Policyowners Equity |
$ | 1,516 | $ | 413 | $ | 1,419 | $ | 1,348 | $ | 1,454 | $ | 4,192 | $ | 1,266 | ||||||||||||||
Executive Variable Universal Life Policies Issued On or After January 31, 2007 (3) |
||||||||||||||||||||||||||||
Policyowners Equity |
928 | 356 | 227 | 958 | 75 | 1,589 | 1,384 | |||||||||||||||||||||
Survivorship Variable Universal Life Policies Issued On or After January 31, 2007 (4) |
||||||||||||||||||||||||||||
Policyowners Equity |
44 | 9 | 62 | 17 | 46 | 156 | 144 | |||||||||||||||||||||
Total Net Assets |
$ | 2,488 | $ | 778 | $ | 1,708 | $ | 2,323 | $ | 1,575 | $ | 5,937 | $ | 2,794 | ||||||||||||||
(1) Investments, at cost |
$ | 1,995 | $ | 684 | $ | 1,310 | $ | 1,807 | $ | 1,297 | $ | 5,288 | $ | 2,840 | ||||||||||||||
Mutual Fund Shares Held |
1,696 | 671 | 962 | 1,379 | 1,296 | 3,435 | 2,840 | |||||||||||||||||||||
(2) Accumulation Unit Value |
$ | 25.934506 | $ | 18.279525 | $ | 29.671998 | $ | 22.519799 | $ | 16.720938 | $ | 4.095847 | $ | 41.380226 | ||||||||||||||
Units Outstanding |
58 | 23 | 48 | 60 | 87 | 1,023 | 31 | |||||||||||||||||||||
(3) Accumulation Unit Value |
$ | 25.934506 | $ | 18.279525 | $ | 29.671998 | $ | 22.519799 | $ | 16.720938 | $ | 4.095847 | $ | 41.380226 | ||||||||||||||
Units Outstanding |
36 | 20 | 8 | 43 | 4 | 388 | 34 | |||||||||||||||||||||
(4) Accumulation Unit Value |
$ | 25.934506 | $ | 18.279525 | $ | 29.671998 | $ | 22.519799 | $ | 16.720938 | $ | 4.095847 | $ | 41.380226 | ||||||||||||||
Units Outstanding |
2 | | 2 | 1 | 3 | 38 | 3 |
The Accompanying Notes are an Integral Part of the Financial Statements.
2
Statements of Assets and Liabilities
Select Bond Division |
High Yield Bond Division |
Balanced Division |
Asset Allocation Division |
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
Russell Aggressive Equity Division |
Russell Non-US |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||||||||
$ | 4,262 | $ | 1,557 | $ | 1,084 | $ | 386 | $ | | $ | | $ | | $ | | $ | | $ | | |||||||||||||||||||
| | | | 2,603 | | | | | | |||||||||||||||||||||||||||||
| | | | | 1,416 | 798 | 1,543 | 1,909 | 1,277 | |||||||||||||||||||||||||||||
15 | 1 | 1 | | 13 | | 5 | 6 | 1 | | |||||||||||||||||||||||||||||
4,277 | 1,558 | 1,085 | 386 | 2,616 | 1,416 | 803 | 1,549 | 1,910 | 1,277 | |||||||||||||||||||||||||||||
| | | | | | | | | | |||||||||||||||||||||||||||||
| | | | | | | | | | |||||||||||||||||||||||||||||
| | | | | | | | | | |||||||||||||||||||||||||||||
$ | 4,277 | $ | 1,558 | $ | 1,085 | $ | 386 | $ | 2,616 | $ | 1,416 | $ | 803 | $ | 1,549 | $ | 1,910 | $ | 1,277 | |||||||||||||||||||
$ | 3,155 | $ | 929 | $ | 574 | $ | 330 | $ | 2,223 | $ | 1,249 | $ | 685 | $ | 1,349 | $ | 1,741 | $ | 958 | |||||||||||||||||||
997 | 609 | 478 | 33 | 332 | 160 | 107 | 174 | 93 | 299 | |||||||||||||||||||||||||||||
125 | 20 | 33 | 23 | 61 | 7 | 11 | 26 | 76 | 20 | |||||||||||||||||||||||||||||
$ | 4,277 | $ | 1,558 | $ | 1,085 | $ | 386 | $ | 2,616 | $ | 1,416 | $ | 803 | $ | 1,549 | $ | 1,910 | $ | 1,277 | |||||||||||||||||||
$ | 4,205 | $ | 1,445 | $ | 988 | $ | 334 | $ | 1,969 | $ | 1,149 | $ | 618 | $ | 1,321 | $ | 1,483 | $ | 1,279 | |||||||||||||||||||
3,315 | 2,151 | 774 | 368 | 81 | 104 | 67 | 151 | 137 | 122 | |||||||||||||||||||||||||||||
$ | 181.992325 | $ | 34.475967 | $ | 137.200077 | $ | 15.054442 | $ | 29.113348 | $ | 10.686543 | $ | 17.202203 | $ | 14.635995 | $ | 31.671345 | $ | 19.746605 | |||||||||||||||||||
17 | 27 | 4 | 22 | 76 | 117 | 40 | 92 | 55 | 49 | |||||||||||||||||||||||||||||
$ | 181.992325 | $ | 34.475967 | $ | 137.200077 | $ | 15.054442 | $ | 29.113348 | $ | 10.686543 | $ | 17.202203 | $ | 14.635995 | $ | 31.671345 | $ | 19.746605 | |||||||||||||||||||
5 | 18 | 3 | 2 | 11 | 15 | 6 | 12 | 3 | 15 | |||||||||||||||||||||||||||||
$ | 181.992325 | $ | 34.475967 | $ | 137.200077 | $ | 15.054442 | $ | 29.113348 | $ | 10.686543 | $ | 17.202203 | $ | 14.635995 | $ | 31.671345 | $ | 19.746605 | |||||||||||||||||||
1 | 1 | | 2 | 2 | 1 | 1 | 2 | 2 | 1 |
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Assets and Liabilities
3
Northwestern Mutual Variable Life Account II
For the Year Ended December 31, 2010
(in thousands)
Growth Stock Division |
Focused Appreciation Division |
Large Cap Core Stock Division |
Index 500 Stock Division |
|||||||||||||
Income: |
||||||||||||||||
Dividend income |
$ | 11 | $ | | $ | 11 | $ | 78 | ||||||||
Net investment income |
11 | | 11 | 78 | ||||||||||||
Realized gain (loss) on investments: |
||||||||||||||||
Realized gain (loss) on sale of fund shares |
20 | 171 | (5 | ) | (81 | ) | ||||||||||
Realized gain distributions |
| | | 30 | ||||||||||||
Realized gains (losses) |
20 | 171 | (5 | ) | (51 | ) | ||||||||||
Change in unrealized appreciation/depreciation of investments during the period |
149 | 58 | 143 | 566 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
$ | 180 | $ | 229 | $ | 149 | $ | 593 | ||||||||
International Equity Division |
Money Market Division |
Select Bond Division |
High Yield Bond Division |
|||||||||||||
Income: |
||||||||||||||||
Dividend income |
$ | 146 | $ | 9 | $ | 143 | $ | 93 | ||||||||
Net investment income |
146 | 9 | 143 | 93 | ||||||||||||
Realized gain (loss) on investments: |
||||||||||||||||
Realized gain (loss) on sale of fund shares |
(276 | ) | | 31 | 64 | |||||||||||
Realized gain distributions |
| | 11 | | ||||||||||||
Realized gains (losses) |
(276 | ) | | 42 | 64 | |||||||||||
Change in unrealized appreciation/depreciation of investments during the period |
577 | | 14 | 9 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
$ | 447 | $ | 9 | $ | 199 | $ | 166 | ||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
4
Statements of Operations
Domestic Equity Division |
Equity Income Division |
Mid Cap Growth Stock Division |
Index 400 Stock Division |
Mid Cap Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
|||||||||||||||||||||||
$ | 39 | $ | 25 | $ | 5 | $ | 22 | $ | 6 | $ | 10 | $ | 20 | $ | 12 | |||||||||||||||
39 | 25 | 5 | 22 | 6 | 10 | 20 | 12 | |||||||||||||||||||||||
(58 | ) | (43 | ) | (62 | ) | 4 | 48 | (15 | ) | (48 | ) | (20 | ) | |||||||||||||||||
| | | 7 | | | | | |||||||||||||||||||||||
(58 | ) | (43 | ) | (62 | ) | 11 | 48 | (15 | ) | (48 | ) | (20 | ) | |||||||||||||||||
|
268 |
|
246 | 421 | 439 | 54 | 337 | 421 | 215 | |||||||||||||||||||||
$ | 249 | $ | 228 | $ | 364 | $ | 472 | $ | 108 | $ | 332 | $ | 393 | $ | 207 | |||||||||||||||
Balanced Division |
Asset Allocation Division |
Fidelity VIP Mid Cap Division |
Russell Multi-Style Equity Division |
Russell Aggressive Equity Division |
Russell Non-US Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||
$ | 21 | $ | 10 | $ | 3 | $ | 10 | $ | 3 | $ | 8 | $ | 33 | $ | 35 | |||||||||||||||
21 | 10 | 3 | 10 | 3 | 8 | 33 | 35 | |||||||||||||||||||||||
22 | (3 | ) | 14 | (43 | ) | (6 | ) | (23 | ) | (21 | ) | 26 | ||||||||||||||||||
| | 6 | | | | | 31 | |||||||||||||||||||||||
22 | (3 | ) | 20 | (43 | ) | (6 | ) | (23 | ) | (21 | ) | 57 | ||||||||||||||||||
|
62 |
|
36 | 494 | 230 | 151 | 185 | 305 | (17 | ) | ||||||||||||||||||||
$ | 105 | $ | 43 | $ | 517 | $ | 197 | $ | 148 | $ | 170 | $ | 317 | $ | 75 | |||||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Operations
5
Statements of Changes in Net Assets
Northwestern Mutual Variable Life Account II
(in thousands)
Growth Stock Division | Focused Appreciation Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | 11 | $ | 8 | $ | | $ | | ||||||||
Net realized gains (losses) |
20 | (33 | ) | 171 | (525 | ) | ||||||||||
Net change in unrealized appreciation/ depreciation |
149 | 241 | 58 | 1,221 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
180 | 216 | 229 | 696 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
471 | 339 | 856 | 1,495 | ||||||||||||
Policy loans, surrenders and death benefits |
(19 | ) | (22 | ) | (1,181 | ) | (45 | ) | ||||||||
Mortality and other (net) |
(123 | ) | (89 | ) | (279 | ) | (224 | ) | ||||||||
Transfers from other divisions |
3,331 | 1,516 | 10,643 | 8,233 | ||||||||||||
Transfers to other divisions |
(3,150 | ) | (1,416 | ) | (10,202 | ) | (8,083 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
510 | 328 | (163 | ) | 1,376 | |||||||||||
Net increase (decrease) in net assets |
690 | 544 | 66 | 2,072 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
938 | 394 | 3,450 | 1,378 | ||||||||||||
End of period |
$ | 1,628 | $ | 938 | $ | 3,516 | $ | 3,450 | ||||||||
Units issued during the period |
155 | 80 | 604 | 621 | ||||||||||||
Units redeemed during the period |
(137 | ) | (67 | ) | (616 | ) | (543 | ) | ||||||||
Net units issued (redeemed) during period |
18 | 13 | (12 | ) | 78 | |||||||||||
Mid Cap Growth Stock Division |
Index 400 Stock Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | 5 | $ | 3 | $ | 22 | $ | 19 | ||||||||
Net realized gains (losses) |
(62 | ) | (134 | ) | 11 | (68 | ) | |||||||||
Net change in unrealized appreciation/ depreciation |
421 | 410 | 439 | 416 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
364 | 279 | 472 | 367 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
298 | 223 | 503 | 249 | ||||||||||||
Policy loans, surrenders and death benefits |
(15 | ) | (11 | ) | (50 | ) | (47 | ) | ||||||||
Mortality and other (net) |
(108 | ) | (75 | ) | (135 | ) | (86 | ) | ||||||||
Transfers from other divisions |
7,369 | 6,221 | 7,715 | 5,945 | ||||||||||||
Transfers to other divisions |
(7,077 | ) | (6,085 | ) | (7,337 | ) | (5,761 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
467 | 273 | 696 | 300 | ||||||||||||
Net increase (decrease) in net assets |
831 | 552 | 1,168 | 667 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
1,171 | 619 | 1,320 | 653 | ||||||||||||
End of period |
$ | 2,002 | $ | 1,171 | $ | 2,488 | $ | 1,320 | ||||||||
Units issued during the period |
123 | 137 | 374 | 385 | ||||||||||||
Units redeemed during the period |
(116 | ) | (130 | ) | (343 | ) | (363 | ) | ||||||||
Net units issued (redeemed) during period |
7 | 7 | 31 | 22 | ||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
6
Statements of Changes in Net Assets
Large Cap Core Stock Division |
Index 500 Stock Division |
Domestic Equity Division |
Equity Income Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 11 | $ | 8 | $ | 78 | $ | 58 | $ | 39 | $ | 34 | $ | 25 | $ | 28 | |||||||||||||||
(5 | ) | (29 | ) | (51 | ) | (113 | ) | (58 | ) | (80 | ) | (43 | ) | (53 | ) | |||||||||||||||
143 | 138 | 566 | 654 | 268 | 338 | 246 | 302 | |||||||||||||||||||||||
149 | 117 | 593 | 599 | 249 | 292 | 228 | 277 | |||||||||||||||||||||||
316 | 170 | 1,318 | 793 | 483 | 433 | 331 | 277 | |||||||||||||||||||||||
(34 | ) | (16 | ) | (93 | ) | (78 | ) | (98 | ) | (27 | ) | (55 | ) | (26 | ) | |||||||||||||||
(93 | ) | (56 | ) | (277 | ) | (175 | ) | (155 | ) | (125 | ) | (88 | ) | (68 | ) | |||||||||||||||
1,995 | 702 | 17,076 | 11,001 | 2,447 | 1,311 | 6,512 | 4,885 | |||||||||||||||||||||||
(1,590 | ) | (623 | ) | (16,487 | ) | (10,411 | ) | (2,309 | ) | (1,103 | ) | (6,201 | ) | (4,670 | ) | |||||||||||||||
594 | 177 | 1,537 | 1,130 | 368 | 489 | 499 | 398 | |||||||||||||||||||||||
743 | 294 | 2,130 | 1,729 | 617 | 781 | 727 | 675 | |||||||||||||||||||||||
588 | 294 | 2,807 | 1,078 | 1,362 | 581 | 1,216 | 541 | |||||||||||||||||||||||
$ | 1,331 | $ | 588 | $ | 4,937 | $ | 2,807 | $ | 1,979 | $ | 1,362 | $ | 1,943 | $ | 1,216 | |||||||||||||||
103 | 45 | 374 | 294 | 257 | 199 | 457 | 429 | |||||||||||||||||||||||
(78 | ) | (37 | ) | (345 | ) | (265 | ) | (225 | ) | (145 | ) | (424 | ) | (392 | ) | |||||||||||||||
25 | 8 | 29 | 29 | 32 | 54 | 33 | 37 | |||||||||||||||||||||||
Mid Cap
Value Division |
Small Cap Growth Stock Division |
Small Cap Value Division |
International Growth Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 6 | $ | 4 | $ | 10 | $ | 1 | $ | 20 | $ | 10 | $ | 12 | $ | 4 | |||||||||||||||
48 | (10 | ) | (15 | ) | (59 | ) | (48 | ) | (67 | ) | (20 | ) | (140 | ) | ||||||||||||||||
54 | 88 | 337 | 229 | 421 | 391 | 215 | 270 | |||||||||||||||||||||||
108 | 82 | 332 | 171 | 393 | 334 | 207 | 134 | |||||||||||||||||||||||
288 | 132 | 480 | 309 | 500 | 295 | 403 | 275 | |||||||||||||||||||||||
(57 | ) | (30 | ) | (94 | ) | (25 | ) | (81 | ) | (50 | ) | (61 | ) | (28 | ) | |||||||||||||||
(44 | ) | (30 | ) | (121 | ) | (72 | ) | (129 | ) | (96 | ) | (112 | ) | (83 | ) | |||||||||||||||
2,770 | 1,509 | 2,976 | 1,168 | 8,073 | 6,343 | 2,488 | 989 | |||||||||||||||||||||||
(2,721 | ) | (1,466 | ) | (2,674 | ) | (1,058 | ) | (7,864 | ) | (6,169 | ) | (2,220 | ) | (846 | ) | |||||||||||||||
236 | 115 | 567 | 322 | 499 | 323 | 498 | 307 | |||||||||||||||||||||||
344 | 197 | 899 | 493 | 892 | 657 | 705 | 441 | |||||||||||||||||||||||
434 | 237 | 809 | 316 | 1,431 | 774 | 870 | 429 | |||||||||||||||||||||||
$ | 778 | $ | 434 | $ | 1,708 | $ | 809 | $ | 2,323 | $ | 1,431 | $ | 1,575 | $ | 870 | |||||||||||||||
195 | 133 | 157 | 81 | 440 | 451 | 206 | 104 | |||||||||||||||||||||||
(180 | ) | (124 | ) | (133 | ) | (64 | ) | (414 | ) | (427 | ) | (173 | ) | (80 | ) | |||||||||||||||
15 | 9 | 24 | 17 | 26 | 24 | 33 | 24 | |||||||||||||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Changes in Net Assets
7
Statements of Changes in Net Assets
Northwestern Mutual Variable Life Account II
(in thousands)
International
Equity Division |
Money Market Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | 146 | $ | 136 | $ | 9 | $ | 18 | ||||||||
Net realized gains (losses) |
(276 | ) | (349 | ) | | | ||||||||||
Net change in unrealized appreciation/ depreciation |
577 | 1,131 | | | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
447 | 918 | 9 | 18 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
1,379 | 1,062 | 7,707 | 6,827 | ||||||||||||
Policy loans, surrenders and death benefits |
(217 | ) | (66 | ) | (220 | ) | (809 | ) | ||||||||
Mortality and other (net) |
(406 | ) | (327 | ) | (340 | ) | (390 | ) | ||||||||
Transfers from other divisions |
13,947 | 10,046 | 10,344 | 9,902 | ||||||||||||
Transfers to other divisions |
(13,014 | ) | (9,750 | ) | (17,426 | ) | (14,445 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
1,689 | 965 | 65 | 1,085 | ||||||||||||
Net increase (decrease) in net assets |
2,136 | 1,883 | 74 | 1,103 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
3,801 | 1,918 | 2,720 | 1,617 | ||||||||||||
End of period |
$ | 5,937 | $ | 3,801 | $ | 2,794 | $ | 2,720 | ||||||||
Units issued during the period |
4,335 | 3,660 | 509 | 445 | ||||||||||||
Units redeemed during the period |
(3,886 | ) | (3,331 | ) | (507 | ) | (418 | ) | ||||||||
Net units issued (redeemed) during period |
449 | 329 | 2 | 27 | ||||||||||||
Fidelity VIP Mid
Cap Division |
Russell Multi-Style Equity Division |
|||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||
Operations: |
||||||||||||||||
Net investment income (loss) |
$ | 3 | $ | 5 | $ | 10 | $ | 8 | ||||||||
Net realized gains (losses) |
20 | (22 | ) | (43 | ) | (37 | ) | |||||||||
Net change in unrealized appreciation/ depreciation |
494 | 342 | 230 | 241 | ||||||||||||
Net increase (decrease) in net assets resulting from operations |
517 | 325 | 197 | 212 | ||||||||||||
Policy Transactions: |
||||||||||||||||
Policyowners net payments |
622 | 516 | 351 | 276 | ||||||||||||
Policy loans, surrenders and death benefits |
(152 | ) | (27 | ) | (47 | ) | (8 | ) | ||||||||
Mortality and other (net) |
(174 | ) | (113 | ) | (108 | ) | (90 | ) | ||||||||
Transfers from other divisions |
5,025 | 1,836 | 1,916 | 1,224 | ||||||||||||
Transfers to other divisions |
(4,592 | ) | (1,645 | ) | (1,884 | ) | (1,047 | ) | ||||||||
Net increase (decrease) in net assets resulting from policy transactions |
729 | 567 | 228 | 355 | ||||||||||||
Net increase (decrease) in net assets |
1,246 | 892 | 425 | 567 | ||||||||||||
Net Assets: |
||||||||||||||||
Beginning of period |
1,370 | 478 | 991 | 424 | ||||||||||||
End of period |
$ | 2,616 | $ | 1,370 | $ | 1,416 | $ | 991 | ||||||||
Units issued during the period |
281 | 133 | 251 | 214 | ||||||||||||
Units redeemed during the period |
(253 | ) | (101 | ) | (225 | ) | (167 | ) | ||||||||
Net units issued (redeemed) during period |
28 | 32 | 26 | 47 | ||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
8
Statements of Changes in Net Assets
Select Bond Division |
High Yield Bond Division |
Balanced Division |
Asset
Allocation Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 143 | $ | 109 | $ | 93 | $ | 60 | $ | 21 | $ | 20 | $ | 10 | $ | 6 | |||||||||||||||
42 | 2 | 64 | (17 | ) | 22 | (36 | ) | (3 | ) | (5 | ) | |||||||||||||||||||
14 | 49 | 9 | 207 | 62 | 104 | 36 | 52 | |||||||||||||||||||||||
199 | 160 | 166 | 250 | 105 | 88 | 43 | 53 | |||||||||||||||||||||||
1,212 | 972 | 307 | 102 | 324 | 195 | 56 | 67 | |||||||||||||||||||||||
(158 | ) | (95 | ) | (26 | ) | (13 | ) | (105 | ) | (14 | ) | (9 | ) | (2 | ) | |||||||||||||||
(293 | ) | (212 | ) | (91 | ) | (46 | ) | (68 | ) | (40 | ) | (22 | ) | (18 | ) | |||||||||||||||
10,185 | 3,833 | 5,413 | 3,897 | 2,715 | 1,609 | 382 | 169 | |||||||||||||||||||||||
(9,456 | ) | (3,220 | ) | (5,227 | ) | (3,575 | ) | (2,428 | ) | (1,463 | ) | (318 | ) | (127 | ) | |||||||||||||||
1,490 | 1,278 | 376 | 365 | 438 | 287 | 89 | 89 | |||||||||||||||||||||||
1,689 | 1,438 | 542 | 615 | 543 | 375 | 132 | 142 | |||||||||||||||||||||||
2,588 | 1,150 | 1,016 | 401 | 542 | 167 | 254 | 112 | |||||||||||||||||||||||
$ | 4,277 | $ | 2,588 | $ | 1,558 | $ | 1,016 | $ | 1,085 | $ | 542 | $ | 386 | $ | 254 | |||||||||||||||
77 | 30 | 188 | 161 | 24 | 16 | 33 | 23 | |||||||||||||||||||||||
(69 | ) | (23 | ) | (176 | ) | (146 | ) | (21 | ) | (14 | ) | (27 | ) | (13 | ) | |||||||||||||||
8 | 7 | 12 | 15 | 3 | 2 | 6 | 10 | |||||||||||||||||||||||
Russell Aggressive Equity Division |
Russell Non-US Division |
Russell Real Estate Securities Division |
Russell Core Bond Division |
|||||||||||||||||||||||||||
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
Year Ended December 31, 2010 |
Year Ended December 31, 2009 |
|||||||||||||||||||||||
$ | 3 | $ | 1 | $ | 8 | $ | 18 | $ | 33 | $ | 30 | $ | 35 | $ | 19 | |||||||||||||||
(6 | ) | (22 | ) | (23 | ) | (48 | ) | (21 | ) | (46 | ) | 57 | (1 | ) | ||||||||||||||||
151 | 109 | 185 | 204 | 305 | 305 | (17 | ) | 34 | ||||||||||||||||||||||
148 | 88 | 170 | 174 | 317 | 289 | 75 | 52 | |||||||||||||||||||||||
206 | 118 | 495 | 268 | 510 | 313 | 264 | 127 | |||||||||||||||||||||||
(24 | ) | (4 | ) | (28 | ) | (42 | ) | (106 | ) | (17 | ) | (24 | ) | (12 | ) | |||||||||||||||
(60 | ) | (37 | ) | (109 | ) | (77 | ) | (145 | ) | (93 | ) | (81 | ) | (45 | ) | |||||||||||||||
1,010 | 447 | 2,772 | 1,391 | 2,585 | 1,101 | 2,438 | 1,082 | |||||||||||||||||||||||
(895 | ) | (401 | ) | (2,627 | ) | (1,262 | ) | (2,308 | ) | (936 | ) | (2,125 | ) | (799 | ) | |||||||||||||||
237 | 123 | 503 | 278 | 536 | 368 | 472 | 353 | |||||||||||||||||||||||
385 | 211 | 673 | 452 | 853 | 657 | 547 | 405 | |||||||||||||||||||||||
418 | 207 | 876 | 424 | 1,057 | 400 | 730 | 325 | |||||||||||||||||||||||
$ | 803 | $ | 418 | $ | 1,549 | $ | 876 | $ | 1,910 | $ | 1,057 | $ | 1,277 | $ | 730 | |||||||||||||||
90 | 51 | 272 | 157 | 118 | 77 | 146 | 74 | |||||||||||||||||||||||
(72 | ) | (42 | ) | (232 | ) | (132 | ) | (99 | ) | (56 | ) | (122 | ) | (54 | ) | |||||||||||||||
18 | 9 | 40 | 25 | 19 | 21 | 24 | 20 | |||||||||||||||||||||||
The Accompanying Notes are an Integral Part of the Financial Statements.
Statements of Changes in Net Assets
9
Northwestern Mutual Variable Life Account II
December 31, 2010
1. Organization Northwestern Mutual Variable Life Account II (the Account) is registered as a unit investment trust under the Investment Company Act of 1940 and is a segregated asset account of The Northwestern Mutual Life Insurance Company (Northwestern Mutual) used to fund variable life insurance policies. The Account began operations on January 31, 2007.
All assets of each Division of the Account are invested in shares of the corresponding Portfolio of Northwestern Mutual Series Fund, Inc., Fidelity Variable Insurance Products and the Russell Investment Funds (collectively known as the Funds). The Funds are open-end investment companies registered under the Investment Company Act of 1940.
2. Significant Accounting Policies
A. | Use of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
B. | Investment Valuation The shares are valued at the Funds offering and redemption prices per share. As of December 31, 2010, all of the Accounts investments are identified as Level 1 securities for valuation purposes under the Fair Value Measurements and Disclosures Topic of the FASB Accounting Standards Codification. Level 1 securities are valued at fair value as determined by quoted prices in active markets for identical securities. |
C. | Investment Income, Securities Transactions and Policy Dividends Transactions in the Funds shares are accounted for on the trade date. The basis for determining cost on sale of the Funds shares is identified cost. Dividend income and distributions of net realized gains from the Funds are recorded on the exdate of the dividends. Dividends and distributions received are reinvested in additional shares of the respective portfolios of the Funds. The policies are eligible to receive dividends from Northwestern Mutual. Any dividends reinvested in the Account are reflected in Policyowners net payments in the accompanying financial statements. |
D. | Taxes Northwestern Mutual is taxed as a life insurance company under the Internal Revenue Code. The variable life insurance policies, which are funded in the Account, are taxed as part of the operations of Northwestern Mutual. Currently, there is no charge being made against the assets of the Account for federal income taxes, but Northwestern Mutual reserves the right to charge for taxes in the future. |
3. Purchases and Sales of Investments Purchases and sales of the Funds shares for the year ended December 31, 2010 were as follows: (in thousands)
Division |
Purchases | Sales | ||||||
Growth Stock |
$ | 700 | $ | 178 | ||||
Focused Appreciation |
1,458 | 1,636 | ||||||
Large Cap Core Stock |
755 | 149 | ||||||
Index 500 Stock |
2,116 | 470 | ||||||
Domestic Equity |
667 | 282 | ||||||
Equity Income |
683 | 166 | ||||||
Mid Cap Growth Stock |
619 | 153 | ||||||
Index 400 Stock |
936 | 214 | ||||||
Mid Cap Value |
354 | 110 | ||||||
Small Cap Growth Stock |
818 | 245 | ||||||
Small Cap Value |
761 | 246 | ||||||
International Growth |
700 | 201 | ||||||
International Equity |
2,531 | 708 | ||||||
Money Market |
9,108 | 8,983 | ||||||
Select Bond |
2,134 | 514 | ||||||
High Yield Bond |
593 | 125 | ||||||
Balanced |
651 | 193 | ||||||
Asset Allocation |
138 | 40 | ||||||
Fidelity VIP Mid Cap |
1,082 | 358 | ||||||
Russell Multi-Style Equity |
420 | 178 | ||||||
Russell Aggressive Equity |
338 | 103 | ||||||
Russell Non-U.S. |
672 | 167 | ||||||
Russell Real Estate Securities |
845 | 276 | ||||||
Russell Core Bond |
659 | 120 |
4. Expenses and Related Party Transactions A deduction for mortality and expense risks is determined monthly and paid to Northwestern Mutual. The mortality risk is that insureds may not live as long as estimated. The expense risk is that expenses of issuing and administering the policies may exceed the estimated costs.
A deduction for the mortality and expense risks for Custom Variable Universal Life policies is determined at an annual rate of 0.35% of the amount invested in the Account for the Policy for the first ten Policy years, 0.20% for the next ten Policy years and 0.05% thereafter. A deduction for the mortality and expense risks for Executive Variable Universal Life policies is determined at an annual rate of 0.20% of the amounts invested in the Account for the Policy for the first ten Policy years, and 0.10% thereafter. A deduction for the mortality and expense risks for Survivorship Variable
10
Notes to Financial Statements
Notes to Financial Statements
Universal Life Policies is determined at an annual rate of 0.10% of the amount invested in the Account for the Policy for the first twenty Policy years, and 0.05% thereafter. These charges are reflected as a reduction in units and are included in Mortality and Other in the accompanying financial statements.
Additional mortality costs are determined monthly and are paid to Northwestern Mutual to cover the cost of providing insurance protection for the first ten Policy years on all Survivorship Variable Universal Life policies based on the age of the insured individuals at the time the policy is issued.
Certain deductions are also made from the annual, single or other premiums before amounts are allocated to the Account. These deductions are for sales load, administrative expenses and taxes.
5. Subsequent Events
No events have occurred subsequent to December 31, 2010 that require disclosure or adjustment to the financial statements at that date or through the date of issuance.
6. Financial Highlights
(For a unit outstanding during the period)
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value | Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return (1) |
||||||||||||||||||
Growth Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
49 | $ 32.998214 | $ | 1,628 | 0.86 | % | 0.05% to 0.35% | 12.37% | ||||||||||||||||
Year Ended 12/31/09 |
31 | $ 29.365924 | $ | 938 | 1.18 | % | 0.05% to 0.35% | 37.17% | ||||||||||||||||
Year Ended 12/31/08 |
18 | $ 21.408736 | $ | 394 | 1.25 | % | 0.05% to 0.35% | (38.86%) | ||||||||||||||||
Period Ended 12/31/07 |
5 | $ 35.015115 | $ | 160 | 0.56 | % | 0.05% to 0.35% | 6.96% | ||||||||||||||||
Focused Appreciation |
||||||||||||||||||||||||
Year Ended 12/31/10 |
169 | $ 20.869750 | $ | 3,516 | 0.00 | % | 0.05% to 0.35% | 9.33% | ||||||||||||||||
Year Ended 12/31/09 |
181 | $ 19.088595 | $ | 3,450 | 0.00 | % | 0.05% to 0.35% | 42.47% | ||||||||||||||||
Year Ended 12/31/08 |
103 | $ 13.397864 | $ | 1,378 | 0.44 | % | 0.05% to 0.35% | (40.01%) | ||||||||||||||||
Period Ended 12/31/07 |
11 | $ 22.333276 | $ | 229 | 0.03 | % | 0.05% to 0.35% | 24.83% | ||||||||||||||||
Large Cap Core Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
50 | $ 26.477036 | $ | 1,331 | 1.26 | % | 0.05% to 0.35% | 12.91% | ||||||||||||||||
Year Ended 12/31/09 |
25 | $ 23.449551 | $ | 588 | 1.89 | % | 0.05% to 0.35% | 29.33% | ||||||||||||||||
Year Ended 12/31/08 |
17 | $ 18.131181 | $ | 294 | 1.79 | % | 0.05% to 0.35% | (38.74%) | ||||||||||||||||
Period Ended 12/31/07 |
3 | $ 29.597322 | $ | 109 | 0.68 | % | 0.05% to 0.35% | 7.29% | ||||||||||||||||
Index 500 Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
84 | $ 58.583796 | $ | 4,937 | 2.07 | % | 0.05% to 0.35% | 14.89% | ||||||||||||||||
Year Ended 12/31/09 |
55 | $ 50.989051 | $ | 2,807 | 2.95 | % | 0.05% to 0.35% | 26.40% | ||||||||||||||||
Year Ended 12/31/08 |
26 | $ 40.340674 | $ | 1,078 | 2.36 | % | 0.05% to 0.35% | (36.94%) | ||||||||||||||||
Period Ended 12/31/07 |
7 | $ 63.972521 | $ | 434 | 0.79 | % | 0.05% to 0.35% | 3.90% | ||||||||||||||||
Domestic Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
152 | $ 13.033112 | $ | 1,979 | 2.36 | % | 0.05% to 0.35% | 14.62% | ||||||||||||||||
Year Ended 12/31/09 |
120 | $ 11.370681 | $ | 1,362 | 3.63 | % | 0.05% to 0.35% | 29.52% | ||||||||||||||||
Year Ended 12/31/08 |
66 | $ 8.778981 | $ | 581 | 3.27 | % | 0.05% to 0.35% | (38.49%) | ||||||||||||||||
Period Ended 12/31/07 |
19 | $ 14.273423 | $ | 274 | 1.30 | % | 0.05% to 0.35% | (7.25%) | ||||||||||||||||
Equity Income |
||||||||||||||||||||||||
Year Ended 12/31/10 |
116 | $ 16.832155 | $ | 1,943 | 1.69 | % | 0.05% to 0.35% | 15.33% | ||||||||||||||||
Year Ended 12/31/09 |
83 | $ 14.595160 | $ | 1,216 | 3.12 | % | 0.05% to 0.35% | 24.58% | ||||||||||||||||
Year Ended 12/31/08 |
46 | $ 11.715261 | $ | 541 | 0.03 | % | 0.05% to 0.35% | (35.81%) | ||||||||||||||||
Period Ended 12/31/07 |
13 | $ 18.250431 | $ | 225 | 3.74 | % | 0.05% to 0.35% | 1.79% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. Returns are not annualized for periods less than one year. |
Notes to Financial Statements
11
Notes to Financial Statements
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value | Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return (1) |
||||||||||||||||||
Mid Cap Growth Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
28 | $ 71.778944 | $ | 2,002 | 0.30 | % | 0.05% to 0.35% | 23.86% | ||||||||||||||||
Year Ended 12/31/09 |
21 | $ 57.953082 | $ | 1,171 | 0.28 | % | 0.05% to 0.35% | 32.09%( | 2) | |||||||||||||||
Year Ended 12/31/08 |
14 | $ 43.872392 | $ | 619 | 0.36 | % | 0.05% to 0.35% | (40.08%) | ||||||||||||||||
Period Ended 12/31/07 |
3 | $ 73.219863 | $ | 165 | 0.70 | % | 0.05% to 0.35% | 16.04% | ||||||||||||||||
Index 400 Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
96 | $ 25.934506 | $ | 2,488 | 1.18 | % | 0.05% to 0.35% | 26.29% | ||||||||||||||||
Year Ended 12/31/09 |
65 | $ 20.535699 | $ | 1,320 | 1.86 | % | 0.05% to 0.35% | 37.00% | ||||||||||||||||
Year Ended 12/31/08 |
43 | $ 14.989442 | $ | 653 | 1.84 | % | 0.05% to 0.35% | (36.28%) | ||||||||||||||||
Period Ended 12/31/07 |
8 | $ 23.522236 | $ | 180 | 1.15 | % | 0.05% to 0.35% | 4.18% | ||||||||||||||||
Mid Cap Value |
||||||||||||||||||||||||
Year Ended 12/31/10 |
43 | $ 18.279525 | $ | 778 | 1.29 | % | 0.05% to 0.35% | 19.93% | ||||||||||||||||
Year Ended 12/31/09 |
28 | $ 15.242180 | $ | 434 | 1.23 | % | 0.05% to 0.35% | 23.24% | ||||||||||||||||
Year Ended 12/31/08 |
19 | $ 12.367958 | $ | 237 | 0.00 | % | 0.05% to 0.35% | (35.07%) | ||||||||||||||||
Period Ended 12/31/07 |
13 | $ 19.047672 | $ | 261 | 2.24 | % | 0.05% to 0.35% | (2.40%) | ||||||||||||||||
Small Cap Growth Stock |
||||||||||||||||||||||||
Year Ended 12/31/10 |
58 | $ 29.671998 | $ | 1,708 | 0.84 | % | 0.05% to 0.35% | 25.85% | ||||||||||||||||
Year Ended 12/31/09 |
34 | $ 23.577314 | $ | 809 | 0.30 | % | 0.05% to 0.35% | 31.17% | ||||||||||||||||
Year Ended 12/31/08 |
17 | $ 17.974245 | $ | 316 | 0.20 | % | 0.05% to 0.35% | (43.87%) | ||||||||||||||||
Period Ended 12/31/07 |
4 | $ 32.021844 | $ | 139 | 0.05 | % | 0.05% to 0.35% | 7.25% | ||||||||||||||||
Small Cap Value |
||||||||||||||||||||||||
Year Ended 12/31/10 |
104 | $ 22.519799 | $ | 2,323 | 1.11 | % | 0.05% to 0.35% | 21.95% | ||||||||||||||||
Year Ended 12/31/09 |
78 | $ 18.466637 | $ | 1,431 | 0.88 | % | 0.05% to 0.35% | 28.18% | ||||||||||||||||
Year Ended 12/31/08 |
54 | $ 14.406429 | $ | 774 | 0.41 | % | 0.05% to 0.35% | (28.13%) | ||||||||||||||||
Period Ended 12/31/07 |
8 | $ 20.045927 | $ | 170 | 0.44 | % | 0.05% to 0.35% | (3.25%) | ||||||||||||||||
International Growth |
||||||||||||||||||||||||
Year Ended 12/31/10 |
94 | $ 16.720938 | $ | 1,575 | 0.97 | % | 0.05% to 0.35% | 16.43% | ||||||||||||||||
Year Ended 12/31/09 |
61 | $ 14.361577 | $ | 870 | 0.67 | % | 0.05% to 0.35% | 23.16% | ||||||||||||||||
Year Ended 12/31/08 |
37 | $ 11.660588 | $ | 429 | 1.92 | % | 0.05% to 0.35% | (46.19%) | ||||||||||||||||
Period Ended 12/31/07 |
7 | $ 21.668250 | $ | 165 | 0.80 | % | 0.05% to 0.35% | 11.73% | ||||||||||||||||
International Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
1,449 | $ 4.095847 | $ | 5,937 | 3.12 | % | 0.05% to 0.35% | 7.67% | ||||||||||||||||
Year Ended 12/31/09 |
1,000 | $ 3.803991 | $ | 3,801 | 4.86 | % | 0.05% to 0.35% | 33.11%( | 2) | |||||||||||||||
Year Ended 12/31/08 |
671 | $ 2.857743 | $ | 1,918 | 3.21 | % | 0.05% to 0.35% | (43.78%) | ||||||||||||||||
Period Ended 12/31/07 |
144 | $ 5.083451 | $ | 735 | 1.28 | % | 0.05% to 0.35% | 16.27% | ||||||||||||||||
Money Market |
||||||||||||||||||||||||
Year Ended 12/31/10 |
68 | $ 41.380226 | $ | 2,794 | 0.29 | % | 0.05% to 0.35% | 0.29% | ||||||||||||||||
Year Ended 12/31/09 |
66 | $ 41.258586 | $ | 2,720 | 0.70 | % | 0.05% to 0.35% | 0.76%( | 2) | |||||||||||||||
Year Ended 12/31/08 |
39 | $ 40.947848 | $ | 1,617 | 2.64 | % | 0.05% to 0.35% | 2.76% | ||||||||||||||||
Period Ended 12/31/07 |
18 | $ 39.847990 | $ | 706 | 4.37 | % | 0.05% to 0.35% | 4.83% | ||||||||||||||||
Select Bond |
||||||||||||||||||||||||
Year Ended 12/31/10 |
23 | $181.992325 | $ | 4,277 | 3.93 | % | 0.05% to 0.35% | 6.59% | ||||||||||||||||
Year Ended 12/31/09 |
15 | $170.745431 | $ | 2,588 | 5.68 | % | 0.05% to 0.35% | 9.37% | ||||||||||||||||
Year Ended 12/31/08 |
8 | $156.116892 | $ | 1,150 | 4.95 | % | 0.05% to 0.35% | 3.26% | ||||||||||||||||
Period Ended 12/31/07 |
2 | $151.194364 | $ | 254 | 2.93 | % | 0.05% to 0.35% | 6.30% | ||||||||||||||||
High Yield Bond |
||||||||||||||||||||||||
Year Ended 12/31/10 |
46 | $ 34.475967 | $ | 1,558 | 7.29 | % | 0.05% to 0.35% | 14.56% | ||||||||||||||||
Year Ended 12/31/09 |
34 | $ 30.094875 | $ | 1,016 | 8.52 | % | 0.05% to 0.35% | 45.39% | ||||||||||||||||
Year Ended 12/31/08 |
19 | $ 20.699102 | $ | 401 | 9.45 | % | 0.05% to 0.35% | (21.35%) | ||||||||||||||||
Period Ended 12/31/07 |
2 | $ 26.317469 | $ | 50 | 3.22 | % | 0.05% to 0.35% | 1.55% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. Returns are not annualized for periods less than one year. |
(2) | Total return reflects the effect of a one-time class action settlement received on June 18, 2009. Absent the payment, the returns would have been 31.99% for the Mid Cap Growth Stock Division, 32.39% for the International Equity Division and 0.61% for the Money Market Division. |
12
Notes to Financial Statements
Notes to Financial Statements
As of the respective period end date: | For the respective period ended: | |||||||||||||||||||||||
Division | Units Outstanding (000s) |
Unit Value | Net Assets (000s) |
Dividend Income as a % of Average Net Assets |
Expense Ratio, Lowest to Highest |
Total Return (1) |
||||||||||||||||||
Balanced |
||||||||||||||||||||||||
Year Ended 12/31/10 |
7 | $137.200077 | $ | 1,085 | 2.32 | % | 0.05% to 0.35% | 11.96% | ||||||||||||||||
Year Ended 12/31/09 |
4 | $122.549243 | $ | 542 | 5.28 | % | 0.05% to 0.35% | 21.43% | ||||||||||||||||
Year Ended 12/31/08 |
2 | $100.918470 | $ | 167 | 1.48 | % | 0.05% to 0.35% | (22.72%) | ||||||||||||||||
Period Ended 12/31/07 |
1 | $130.596514 | $ | 31 | 3.37 | % | 0.05% to 0.35% | 5.24% | ||||||||||||||||
Asset Allocation |
||||||||||||||||||||||||
Year Ended 12/31/10 |
26 | $ 15.054442 | $ | 386 | 3.10 | % | 0.05% to 0.35% | 13.01% | ||||||||||||||||
Year Ended 12/31/09 |
20 | $ 13.321541 | $ | 254 | 3.15 | % | 0.05% to 0.35% | 27.09% | ||||||||||||||||
Year Ended 12/31/08 |
10 | $ 10.482012 | $ | 112 | 2.90 | % | 0.05% to 0.35% | (30.13%) | ||||||||||||||||
Period Ended 12/31/07 |
1 | $ 15.001132 | $ | 10 | 1.00 | % | 0.05% to 0.35% | 8.25% | ||||||||||||||||
Fidelity VIP Mid Cap |
||||||||||||||||||||||||
Year Ended 12/31/10 |
89 | $ 29.113348 | $ | 2,616 | 0.14 | % | 0.05% to 0.35% | 28.57% | ||||||||||||||||
Year Ended 12/31/09 |
61 | $ 22.643898 | $ | 1,370 | 0.54 | % | 0.05% to 0.35% | 39.75% | ||||||||||||||||
Year Ended 12/31/08 |
29 | $ 16.202990 | $ | 478 | 0.26 | % | 0.05% to 0.35% | (39.61%) | ||||||||||||||||
Period Ended 12/31/07 |
7 | $ 26.828755 | $ | 193 | 0.61 | % | 0.05% to 0.35% | 13.55% | ||||||||||||||||
Russell Multi-Style Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
133 | $ 10.686543 | $ | 1,416 | 0.88 | % | 0.05% to 0.35% | 16.46% | ||||||||||||||||
Year Ended 12/31/09 |
107 | $ 9.176223 | $ | 991 | 1.17 | % | 0.05% to 0.35% | 31.40% | ||||||||||||||||
Year Ended 12/31/08 |
60 | $ 6.983334 | $ | 424 | 1.27 | % | 0.05% to 0.35% | (40.56%) | ||||||||||||||||
Period Ended 12/31/07 |
17 | $ 11.749485 | $ | 196 | 0.66 | % | 0.05% to 0.35% | 8.54% | ||||||||||||||||
Russell Aggressive Equity |
||||||||||||||||||||||||
Year Ended 12/31/10 |
47 | $ 17.202203 | $ | 803 | 0.47 | % | 0.05% to 0.35% | 24.88% | ||||||||||||||||
Year Ended 12/31/09 |
29 | $ 13.775086 | $ | 418 | 0.50 | % | 0.05% to 0.35% | 31.39% | ||||||||||||||||
Year Ended 12/31/08 |
20 | $ 10.483725 | $ | 207 | 1.09 | % | 0.05% to 0.35% | (42.92%) | ||||||||||||||||
Period Ended 12/31/07 |
4 | $ 18.365962 | $ | 87 | 0.38 | % | 0.05% to 0.35% | 1.32% | ||||||||||||||||
Russell Non-U.S. |
||||||||||||||||||||||||
Year Ended 12/31/10 |
106 | $ 14.635995 | $ | 1,549 | 0.71 | % | 0.05% to 0.35% | 11.42% | ||||||||||||||||
Year Ended 12/31/09 |
66 | $ 13.135524 | $ | 876 | 2.83 | % | 0.05% to 0.35% | 26.49% | ||||||||||||||||
Year Ended 12/31/08 |
41 | $ 10.384851 | $ | 424 | 0.00 | % | 0.05% to 0.35% | (42.41%) | ||||||||||||||||
Period Ended 12/31/07 |
11 | $ 18.032632 | $ | 205 | 4.62 | % | 0.05% to 0.35% | 9.17% | ||||||||||||||||
Russell Real Estate Securities |
||||||||||||||||||||||||
Year Ended 12/31/10 |
60 | $ 31.671345 | $ | 1,910 | 2.28 | % | 0.05% to 0.35% | 22.92% | ||||||||||||||||
Year Ended 12/31/09 |
41 | $ 25.765834 | $ | 1,057 | 4.34 | % | 0.05% to 0.35% | 28.94% | ||||||||||||||||
Year Ended 12/31/08 |
20 | $ 19.982226 | $ | 400 | 1.85 | % | 0.05% to 0.35% | (36.68%) | ||||||||||||||||
Period Ended 12/31/07 |
11 | $ 31.559603 | $ | 346 | 3.89 | % | 0.05% to 0.35% | (22.64%) | ||||||||||||||||
Russell Core Bond |
||||||||||||||||||||||||
Year Ended 12/31/10 |
65 | $ 19.746605 | $ | 1,277 | 3.73 | % | 0.05% to 0.35% | 10.02% | ||||||||||||||||
Year Ended 12/31/09 |
41 | $ 17.948158 | $ | 730 | 4.73 | % | 0.05% to 0.35% | 15.81% | ||||||||||||||||
Year Ended 12/31/08 |
21 | $ 15.497865 | $ | 325 | 3.63 | % | 0.05% to 0.35% | (3.57%) | ||||||||||||||||
Period Ended 12/31/07 |
3 | $ 16.070912 | $ | 56 | 6.26 | % | 0.05% to 0.35% | 7.35% |
(1) | Total Return includes deductions for management and other expenses; it excludes deductions for sales loads and other charges. Returns are not annualized for periods less than one year. |
Notes to Financial Statements
13
Report of Independent Registered Public Accounting Firm
To The Northwestern Mutual Life Insurance Company and
Policyowners of Northwestern Mutual Variable Life Account II
In our opinion, the accompanying statements of assets and liabilities, the related statements of operations, and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Northwestern Mutual Variable Life Account II and its Growth Stock Division, Focused Appreciation Division, Large Cap Core Stock Division, Index 500 Stock Division, Domestic Equity Division, Equity Income Division, Mid Cap Growth Stock Division, Index 400 Stock Division, Mid Cap Value Division, Small Cap Growth Stock Division, Small Cap Value Division, International Growth Division, International Equity Division, Money Market Division, Select Bond Division, High Yield Bond Division, Balanced Division, Asset Allocation Division, Fidelity VIP Mid Cap Division, Russell Multi-Style Equity Division, Russell Aggressive Equity Division, Russell Non-US Division, Russell Real Estate Securities Division, and Russell Core Bond Division at December 31, 2010, and the results of each of their operations, the changes in each of their net assets and their financial highlights for the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as financial statements) are the responsibility of The Northwestern Mutual Life Insurance Companys management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included direct confirmation of securities owned at December 31, 2010 with Northwestern Mutual Series Fund, Inc., Fidelity Variable Insurance Products Fund III and the Russell Investment Funds, provide a reasonable basis for our opinion.
February 18, 2011
14
Report of Independent Registered Public Accounting Firm
P.O. Box 3095
Milwaukee, WI 53201-3095
PRSRT BPM US POSTAGE
PAID
NORTHWESTERN MUTUAL
This booklet contains information about the Northwestern Mutual variable insurance products and the mutual funds identified on the front cover. The mutual funds correspond with the investment divisions available under the variable insurance product (Product). The information is prepared for Product owners and does not represent an offer of the Product, nor should it be used in connection with any offer, except when accompanied or preceded by the current Product prospectus and the mutual fund prospectuses, which contain detailed information about mutual fund investment objectives and operations, applicable fees, expenses and sales charges. Prospectuses may be obtained by calling the telephone number or visiting the website address listed below. You should read and carefully consider this information before you invest or send money. The mutual fund reports are prepared from the books and records of the funds. Discussions of investment performance in the reports represent the views of the funds portfolio managers as of the dates of the reports. They are not guarantees of investment results, nor should they be relied upon as investment advice or indications of current or future trading strategies of the portfolio managers. Portfolio manager views and security holdings are subject to change at any time.
NMIS is a member of Financial Industry Regulatory Authority (FINRA) and in accordance with the Investor Education and Protection Rule, we are providing our clients information regarding FINRA BrokerCheck, a free resource available to investors. An investor brochure describing FINRA BrokerCheck may be obtained online from FINRAs Web site at www.finra.org or by contacting the FINRA BrokerCheck Hotline at 800-289-9999. The Northwestern Mutual Life Insurance Company (Northwestern Mutual), 1-866-424-2609, www.northwesternmutual.com Product Distributor: Northwestern Mutual Investment Services, LLC (NMIS), Suite 600, 611 East Wisconsin Avenue, Milwaukee, WI 53202-4797, 1-866-664-7737, member FINRA and SIPC
The Northwestern Mutual
Life Insurance Company Milwaukee, WI www.northwesternmutual.com
90-1899 (0786) (REV 0111)
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