Performance Review
- $950.2B Insurance in Force
- $321.6B Total Life Company Assets
- $7.1B Highest Benefits Payout in Our History
- $33.8B Total Adjusted Capital
- $1.9B Highest Estimated Dividend Payout in Our History
Despite a weaker economic environment, MassMutual continued to thrive and achieved $39 billion in total reported sales in 2022, an increase of 26 percent year-over-year.6 This was driven by solid life insurance sales, record annuity sales, especially fixed and fixed-indexed, as well as strong growth in our stable value product sales. As we continue to manage through uncertainty and volatility in the financial markets and the prospect of slower economic growth, we have an enormous opportunity to help more people build financial security for themselves and their families. Our efforts have been recognized with the highest financial strength ratings of any company in the industry,2 including A++ Superior by A.M. Best Company, AA+ Very Strong by Fitch Ratings, Aa3 High Quality by Moody’s Investors Service, and AA+ Very Strong by Standard & Poor’s.
U.S. Insurance and Annuity Sales
(in Millions)
MassMutual sales included solid life sales and record contributions from annuities, supported by our 2021 acquisition of MassMutual Ascend, as well as our expanded distribution network.
U.S. insurance and annuity sales includes life insurance, disability income insurance, long-term care, accident, and critical illness insurance, as well as annuities. Full-year MassMutual Ascend annuity sales are included in 2021 and 2022 as well as the company’s pension risk transfer sales in 2021.
U.S. Whole Life Sales
(in Millions)
MassMutual remains an industry leader in whole life sales, moving into the No. 1 sales rank in 2022 (LIMRA).
All channels (MMFA, Third Party and Direct-to-Consumer, Worksite) whole life sales (including hybrid-life/long term care policies and riders).
Annuity Sales
(in Millions)
Annuity sales grew to a record high, primarily bolstered by fixed, fixed-indexed annuity sales via third-party sales, as well as MassMutual Ascend.
Annuity sales include fixed, income, and variable annuities. MassMutual Ascend full-year annuity sales are included in 2021 and 2022.
Institutional Sales
(in Millions)
Institutional sales witnessed strong results across our protection and accumulation markets, with notably strong sales in stable value solutions.
Institutional sales include corporate-owned life insurance, bank-owned life insurance, stable value, pension risk transfer solutions, and funding agreements.
Worksite Sales
(in Millions)
Worksite sales were supported by growth in whole life sales in 2022.
Worksite sales include life, disability, critical illness, and accident insurance sold at the workplace.
Summary of Financial Position
(Consolidated statutory basis, in $ Millions)
| As of December 31, 2022: | 2022 | 2021 |
|---|---|---|
| Short-term investments and cash | 5,737 | 6,210 |
| Bonds | 140,394 | 128,494 |
| Other invested assets | 105,827 | 100,330 |
| Total invested assets | 251,958 | 235,034 |
| Other assets | 10,084 | 9,195 |
| Separate account assets | 59,537 | 83,264 |
| Total assets | 321,579 | 327,493 |
| Policyowners’ reserves and other | 175,935 | 160,222 |
| Policyowners’ dividends | 1,927 | 1,828 |
| Other liabilities | 50,595 | 48,823 |
| Asset valuation reserve | 5,774 | 6,525 |
| Separate account liabilities | 59,407 | 83,116 |
| Total liabilities | 293,638 | 300,514 |
| Surplus | 27,941 | 26,979 |
| Total liabilities and surplus | 321,579 | 327,493 |
Strong Growth
Total invested assets grew more than 7% to $252B, reflecting an attractive and diversified product portfolio and investment strategy.
Record Surplus & Total Adjusted Capital
Surplus and capital grew to record levels in 2022 with increases of 3.6% and 3.2%, respectively, over the prior year.
Consolidated Statutory Results7
Policyowners’ Dividends8
(in Millions)
Our 2022 policyowners’ dividends exceeded $1.9 billion, affirming our commitment to operate for the benefit of our eligible participating policyowners.
Total Life Company Assets
(in Billions)
While total company assets dipped in 2022, given the decline in separate account assets, total invested assets grew by more than 7 percent on the year.
Total Adjusted Capital7
(in Billions)
Total adjusted capital grew to a record $33.8 billion, an increase of 3 percent from 2021, continuing to underscore our financial strength.
“Despite considerable geopolitical and economic uncertainty, we maintained strong financial results in 2022 as a result of continued progress to transform our business to reach more people with broader solutions and better experiences. This is demonstrated with our very strong market positions in whole life as well as annuities.”
Elizabeth Ward Chief Financial Officer
Summary of Operations
(Consolidated statutory basis, in $ Millions)
| As of December 31, 2022: | 2022 | 2021 |
|---|---|---|
| Premium income | 23,749 | 20,180 |
| Net investment income | 9,396 | 8,938 |
| Fees and other income | 1,195 | 1,341 |
| Total revenue | 34,340 | 30,459 |
| Policyowners’ benefits | 17,644 | 12,215 |
| Change in policyowners’ reserves | 9,899 | 11,392 |
| Commissions, other expenses, and deductions | 4,580 | 4,735 |
| Total benefits and expenses | 32,123 | 28,342 |
| Net gain from operations before dividends and taxes | 2,217 | 2,117 |
| Dividends to policyowners12 | 1,906 | 1,808 |
| Net gain from operations before taxes | 311 | 309 |
| Federal income tax (benefit) expense | (45) | 86 |
| Net gain from operations | 356 | 223 |
| Net realized capital gain (losses) | 342 | (533) |
| Net income (loss) | 698 | (310) |
Income Increase
Total revenue increased over 12.7%, benefiting from MassMutual’s diversified investment strategy and whole life and annuity sales growth.
Dividends & Policyowners
MassMutual has announced that it will deliver a leading dividend interest rate5 among our peers for the 17th consecutive year, paying $1.9B in estimated dividend payout in 2023.
Enterprise Measures
Life Insurance in Force
(in Billions)
Life insurance in force represents the amount of protection the company has issued and remains outstanding. This measure continues to grow, with an increase of more than 6 percent over the prior year, due to strong sales and retention rates.
Insurance and Annuity Benefits
(in Billions)
We continued delivering long-term value, paying more than $7 billion in insurance and annuity benefits to policyowners and customers in 2022.
Assets Under Management13
(in Billions)
Despite challenging market conditions, our total assets under management grew moderately in 2022.
Investment Philosophy & Strategy
Building with a Long-Term Investment Strategy
MassMutual’s investment approach is rooted in diversification with a focus on creating long-term value. Our General Investment Account (GIA) is comprised of the assets used to meet our obligations to our policyowners over time. The following principles are key to our approach:
Diversification
We diversify the composition of the GIA by investing in a variety of asset classes — from municipal, corporate, and Treasury bonds to commercial mortgages, private equity, and real estate. This approach increases the opportunity to capture positive returns across issuers and sectors while minimizing the impact of underperformance. MassMutual further diversifies by investing in strategic partnerships in international insurance and asset management businesses.
Relative Value
A relative-value assessment of risk versus return informs our decision-making process as we consider various opportunities and their prospective impacts on GIA performance.
Strategic Businesses & Investments
One of MassMutual’s longstanding, distinct competitive advantages has been our portfolio of strategic businesses and investments. This portfolio has generated additional earnings for the company in a broad range of economic environments and helps with our goal to pay a competitive dividend to participating policyowners.
This portfolio consists of businesses we have long held — including our Institutional Solutions (IS) and annuities businesses, and Barings, our global institutional asset manager — as well as businesses we invest in, such as Invesco, one of the largest asset management companies in the world, and Rothesay, one of the largest specialist annuity providers in the U.K. In addition, we continue to evolve this portfolio in response to market trends and capitalize on growth opportunities.
Some of the more recent additions to this portfolio include:
- MassMutual Ascend, which was recently rebranded from Great American Life Insurance Company, which we acquired from American Financial Group, Inc. in 2021. MassMutual Ascend is a leader in the fixed and fixed-indexed annuity market and has enabled MassMutual to become a leading annuity provider.
- Martello Re, a company we founded with other investors in 2022 to provide reinsurance services to help us better manage risk in our product suite, with the goal to help other companies do the same.
Invested Assets14
As of December 31, 2022 (in Millions)
$251,958M Total Invested Assets
Bonds16
As of December 31, 2022 (in Millions)
$125,440M Total Bonds
- 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 S&P Global Ratings, AA+ (Very Strong). Ratings are current as of February 1, 2023, and are subject to change.
- The dividend and dividend interest rate (DIR) are determined annually, subject to change and are not guaranteed. Dividends for eligible participating life insurance policies primarily consist of investment, mortality, and expense components. The DIR is used to determine the investment component of the dividend. It is not the rate of return on the policy and should not be the sole basis for comparing insurers or policy performance.
- This is a consolidated sales number for MassMutual and MassMutual Ascend (it includes sales from distribution channels: MMFA, MMSD, Worksite, Institutional, MM Ascend, Direct to Consumer/Haven Life and MM Funds, and Flourish).
- Consolidated statutory results of Massachusetts Mutual Life Insurance Company and its U.S.-domiciled life insurance subsidiaries: C.M. Life Insurance Company (C.M. Life) , MML Bay State Life Insurance Company (MML Bay State), and MassMutual Ascend (f/k/a Great American Life Insurance Company), as well as key investment subsidiaries and operations, as of December 31, 2022.
- Policyowners’ dividends include the estimated amount of annual dividends and settlement dividends. Dividends are determined annually, subject to change, and not guaranteed.
- Total Assets
- Separate Account and Other Assets
- Total Invested Assets
- Source: Massachusetts Mutual Life Insurance Company Statutory Annual Statement, Year-End — Summary of Operations — Dividends to Policyowners: These numbers reflect incurred dividends to policyowners. Incurred dividends equal amounts paid to eligible participating policyowners plus any change in liabilities.
- Assets Under Management (AUM) include assets and certain external investment funds managed by MassMutual subsidiaries, including Barings and MassMutual Ascend. AUM from MassMutual International, OppenheimerFunds, Inc., and the retirement plan business excluded from 2018 ($363 billion), 2019 ($172 billion), and 2020 ($191 billion) as those businesses have been sold.
- Invested Assets exclude $17,106 million of funds withheld, given that 100 percent of the associated investment risk is reinsured. The funds withheld investment portfolio has counterparty protections in place, including investment guidelines that were established to meet MassMutual’s risk management objectives.
- Policy loans are loans taken by policyowners against the cash surrender value of their policies and, as such, are secured by the cash surrender value of those policies.
- Bonds exclude $14,955 million of funds withheld, given that 100 percent of the associated investment risk is reinsured. The funds withheld investment portfolio has counterparty protections in place, including investment guidelines that were established to meet MassMutual’s risk management objectives.
- Residential mortgage-backed securities (RMBS), commercial mortgage-backed securities (CMBS), and asset-backed securities (ABS).
