CEO Letter
Dear Fellow Policyowners and Customers,
At MassMutual, our commitment to mutuality does more than set us apart. It gives our work purpose. It’s a mindset that informs our decisions and protects our values. Above all, it’s a pledge that allows every solution we offer to be backed by people who put you first.
By operating for the benefit of our members and participating policyowners, we can make long-term decisions without the constraints of short-term pressures. This enables us to focus on investing in new solutions and digital experiences while strengthening our foundation to keep our commitments for decades to come.
That’s how we spent 2019: expanding our offerings to meet your needs today, while taking steps to meet your needs tomorrow. And we continued to Live Mutual, helping to create a world where we rely on each other to build a stronger future together.
As a company founded almost 168 years ago in Springfield, Massachusetts, our long-term success has depended on our ability to adapt to change and ensure we remain well-positioned to continue to help people secure their futures and protect the ones they love for another 168 years and beyond.
A Year of Success Amid Uncertainty
While global uncertainty and day-to-day market volatility punctuated the economy in 2019, there was plenty to be happy about. The longest economic expansion on record continued as unemployment fell to historic lows, wages rose, and equity markets soared to all-time highs. At the same time, this enthusiasm was tempered by plummeting global interest rates, which put pressure on financial institutions and individual savers alike.
In this environment, MassMutual continued to perform strongly and fulfill our obligations to our customers. Sales from our U.S. insurance and retirement operations grew 15 percent to more than $28 billion, which, along with other factors, helped drive operating earnings to more than $2.2 billion. What’s more, we increased the insurance protection we provide to nearly $775 billion, while delivering more than $5.7 billion in insurance and annuity benefits, helping people in their time of greatest need.
All of this was underscored by MassMutual’s enduring financial strength, with total adjusted capital growing to more than $24 billion and ratings that are among the highest of any company in any industry.1 This enabled us to approve an estimated $1.7 billion dividend payout for 2020 to our eligible participating policyowners, the 152nd consecutive year we have paid a dividend.2
Along with exceptional short-term performance, we solidified our long-term financial position so we can continue to invest in our business and meet your needs far into the future. This involved the ongoing, bold evolution of our portfolio of businesses. Most notably, we combined our asset management affiliate OppenheimerFunds with Invesco, making us the largest shareholder in one of the world’s biggest asset management companies. With a reliable stream of earnings, additional capital, and expanded investment offerings in the future, we’re confident this transaction will benefit our policyowners for years to come.
Building Greater Experiences and Accessibility
While we’re proud of these accomplishments, our true measure of success is the security and confidence we bring to our customers’ lives. As a mutual company, we can do that by making long-term investments in innovation to better serve you, no matter what life brings. With the resources of a nearly 170-year-old company and the boldness of a startup, we are creating an experience that is simple, personalized, and empowering.
For example, we are embarking on a strategy to offer a digital solution that consolidates all financial and account information into one place, allowing our financial professionals to better serve you in what we believe will be an industry-leading experience. We’ve already brought a similar level of personalization to the workplace, where we introduced MapMyFinancesSM, an online tool that helps prioritize savings and coverage based on your individual situation, budget, and goals. And, through Haven Life, MassMutual’s in-house startup, we continued to roll out innovative new offerings, such as expanded health and wellness services, as well as AgeUpSM, an online solution that helps protect families from the financial risk of loved ones living into their 90s and beyond.
Along with developing greater experiences, we’re also broadening access to our solutions. Our investments in data analytics have allowed us to transform how life insurance is purchased, using algorithms to deliver protection with efficiency and ease. In addition, we’ve used these algorithms to educate consumers by introducing MyLifeScoreSM, a risk-scoring system to help people better understand the link between personal health and insurance costs.
Our work here aims to address a sobering fact: financial security remains out of reach for far too many. By simplifying it, demystifying it, and constantly improving how we deliver it, we will make it easier for millions more to achieve it.
Supporting Our People and Our Communities
Yet as we look to the future, we know it’s not just our customers who need our support. It’s our people. After all, our employees are the ones who dedicate themselves to those we help. By investing in them, we are building a flexible, empowering, and inclusive culture that is ready to adapt to the changes ahead.
A big part of this centers on seizing the innovative spirit of where our journey began in 1851, in our home state of Massachusetts. In June, we took a big step when we broke ground on our new office building in Boston. By deepening our commitment to Massachusetts, we’re building a bridge across the Commonwealth and tapping into the best of all it has to offer.
We also know our employees can only do their best work if they can live their best lives. That’s why we’ve expanded and modernized our benefits to more broadly cover needs based on how families have evolved, from fertility treatment, to gender affirmation, to cancer care. We’ve also adopted a more generous leave policy to give people more time when they need it most, whether it’s becoming a parent, grieving the loss of a loved one, or volunteering in their communities. All of this enables our people to manage life’s events, both planned and unplanned, just as we’ve helped families do for generations.
At the same time, our culture is only stronger if it has diverse perspectives to drive the best outcomes and make it a welcoming place to work. As such, we continued to foster an inclusive environment—from training on mitigating unconscious bias and practicing inclusive leadership, to holding ourselves accountable by setting annual goals to improve workplace diversity, to actively lending our support for causes that advocate greater equality. In doing so, we are creating a place that values and celebrates differences, recognizing the strength they bring to both our company and each other.
Finally, we bring this same philosophy of inclusive support to our work in our communities, where we are committed to focused, long-term investment. Our MassMutual Foundation is now embarking on such an effort through our Live Mutual Project, which aims to increase social connections and financial wellness in underserved areas by bringing resources and expertise to residents to help transform their communities, neighborhood by neighborhood.
And, in a year of strong numbers, we were especially proud of how many people we reached through our philanthropic work. We’ve provided nearly 2 million students with financial and life lessons through our FutureSmart program, and protected more than 14,000 families with $700 million in coverage through our LifeBridgeSM free life insurance program.3 Programs like this are part of our ongoing effort to bring opportunity and security to young people as they embark on a bright future.
A Live Mutual Future
I’m very proud of everything we accomplished in 2019. But I’m even prouder of how we accomplished it. By putting people first, time and again. And by focusing on the challenges you face today, while ensuring you can rely on us for decades to come.
That is what it means to be a mutual company. It means that our focus stays, first and foremost, on our purpose: to help people secure their future and protect the ones they love.
We look forward to working with you in 2020 and beyond to sustain that commitment, expand the ways we serve you, and bring greater confidence to each and every life we touch.
Sincerely,
Roger W. Crandall
Chairman, President & Chief Executive Officer
-
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, AA+ (Very Strong); Moody’s Investors Service, Aa3 (High Quality); and Standard & Poor’s, AA+ (Very Strong). Ratings are as of March 1, 2020 and are subject to change.
-
Dividends are determined annually, subject to change, and not guaranteed.
-
MassMutual pays the premiums.