MassMutual Approves $1.23 Billion Dividend for Policyholders

Payout reflects commitment to mutuality, continued strong financial position

(Springfield, MA) - Massachusetts Mutual Life Insurance Company (MassMutual) today announced it has approved an estimated payment of $1.23 billion in dividends to eligible participating policyholders in 2010. The total dividends for 2010, approved by MassMutual’s Board of Directors, include a dividend interest rate of 7.0 percent on new eligible participating life insurance policies1 and reflects the company’s continued strong financial position.

“As a 158 year-old mutual company, MassMutual is committed to delivering long-term value to our policyholders, and our history of continued strong dividends on eligible participating policies is proof of that pledge,” said Roger W. Crandall, President and Chief Operating Officer, MassMutual. “Paying a strong dividend is core to our corporate strategy, and we’re proud to validate that strategy and continue this tradition with our approved 2010 payout. The market volatility and economic conditions of the past year have heightened the importance of doing business with a financially strong company, and our strategic commitment to pay strong dividends is evidence of the continued strength and stability that our policyholders have come to expect from MassMutual.”

Customers who purchase eligible participating products from MassMutual receive an equitable share of the company’s divisible surplus in the form of dividends as approved by MassMutual’s Board of Directors each year. MassMutual has paid dividends each year since the 1860s.

“Receiving consistent, competitive dividends is perhaps the most tangible benefit of doing business with a mutual company,” Crandall said. “Dividends can help our policyholders build value in their participating policies and also help contribute to the overall financial strength of the company by increasing the size and quality of our policy base – two attributes that illustrate the confidence, security and trust that MassMutual has offered for nearly 150 years.”

The dividends, which are not guaranteed, come primarily from three sources: investment results, favorable mortality experience and savings on expenses. Nearly all of MassMutual’s dividends are paid to eligible participating policyholders who have purchased whole life insurance, the company’s core product. Of the total dividend payout of $1.23 billion, an estimated $1.20 billion in dividends has been approved for more than 1.2 million eligible participating whole life policyholders.

“Dividends are one of the many benefits of whole life insurance,” said Michael R. Fanning, Executive Vice President and head of MassMutual’s U.S. insurance business. “In addition to providing a death benefit, cash value and premiums that are all guaranteed, whole life insurance offers stability, security and flexibility and serves as an excellent foundation for a financial strategy. We have seen newfound, growing interest in the value that whole life insurance delivers, which has helped fuel the outstanding sales growth and momentum we have seen in MassMutual’s core product.”

Policyholders can use dividends from participating products such as whole life for a wide variety of purposes. Options include receiving dividends in cash, or using them to reduce premiums, purchase additional insurance coverage, accumulate at interest, or repay policy loans and policy loan interest.

MassMutual maintains among the highest financial strength ratings of any company in any industry, and the 2010 estimated dividends reflect MassMutual’s continued financial strength. As of November 2, 2009, financial strength ratings for MassMutual and its subsidiaries, C.M. Life Insurance Company and MML Bay State Life Insurance Company are as follows: A.M. Best Company, A++ (Superior); Fitch Ratings, AAA (Exceptionally Strong); Moody’s Investors Service, Aa1 (Excellent); and Standard & Poor’s, AA+ (Very Strong). Ratings are subject to change.

For more information on MassMutual’s financial strength, visit the company’s Web site to view the following resources:

Take Comfort in a Trusted Relationship: Understanding the Value of a Mutually Owned Company
Explains the mutual form of ownership and how MassMutual works for the benefit of its members and participating policyholders.

Strength and Stability in Uncertain Times
Provides an overview of MassMutual’s financial strength, investment philosophy, and products and services in light of recent economic and market conditions.

What are Insurance Policy Dividends?
Explains what dividends are, how they are calculated, and other important facts.


1 This refers to business issued since the MassMutual-Connecticut Mutual merger in 1996. For policies issued prior to the merger, the dividend interest rates are 6.85% for those issued by MassMutual and 6.70% for those issued by the former Connecticut Mutual. The dividend interest rate is not the rate of return on the policy. Dividends consist of an investment component, a mortality component and an expense component. Therefore, dividend interest rates should not be the sole basis for comparing insurers or policy performance.