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2019 Annual & Corporate
Responsibility Report

Performance

Performance Review

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2019 was another successful year for MassMutual, marked by double-digit sales and earnings growth, as well as record levels of capital. This was achieved against a mixed backdrop, with favorable equity markets counterbalanced by global uncertainty and a continued low interest rate environment.

Total revenue was more than $30 billion, reflecting industry-leading sales in core businesses and a diversified portfolio of products and services.
Highlights include:

  • Weighted1 Whole Life Insurance sales of $607 million.

  • Record annuity sales, topping $5 billion for the second consecutive year.

  • Strong sales from our Institutional businesses exceeding $14 billion, an increase of 37 percent over prior year.

  • $25 billion in sales through MML Investors Services, MassMutual’s broker-dealer and registered investment adviser offering investment and wealth management solutions.

Bottom-line results were strong. Statutory net gain from operations before policyowners dividends and taxes, our primary earnings measure as a mutual company, was $2.2 billion, a notable increase over prior year reflecting business growth and operational efficiencies.

Our performance was underscored by our enduring financial strength. Statutory surplus grew to a record $19 billion and total adjusted capital was more than $24 billion. Our ratings remain amongst the highest of any company in any industry. This enabled us to approve a $1.7 billion dividend2 payout for 2020 to our eligible participating policyowners, the 152nd consecutive year we have paid a dividend.

  1. Weighted sales are based on annualized new premium, with single premium payments weighted at 10 percent.

  2. Dividends are determined annually, subject to change, and not guaranteed.

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U.S. Insurance Sales (In Millions)

MassMutual insurance sales included record contributions from annuities, as well as continued growth in our life and disability income products. Our product offering reflects a focus on creating solutions and long-term value for our policyowners while prudently managing risk.

U.S. Insurance sales include individual life insurance, disability income insurance, long term care insurance, and annuities.

U.S. Whole Life Sales (In Millions)

MassMutual is an industry leader in whole life sales, with sales exceeding $1 billion for the fourth consecutive year.

These consolidated results of Massachusetts Mutual Life Insurance Company also include its U.S.-domiciled, wholly owned subsidiaries: MML Bay State Life Insurance Company and C.M. Life Insurance Company. Prior year results have been restated to include additional products.

Annuity Sales (In Millions)

Annuity sales continue to grow, reflecting MassMutual’s competitive offering in the fixed annuity market.

Annuity sales include individual fixed, income, and variable annuities.

Workplace & Institutional Sales (In Billions)

Workplace and Institutional businesses generated record sales, up 18 percent from 2018, with solid results across a broad product line. MassMutual maintains a meaningful presence in the pension risk transfer and bank-owned life insurance markets, with more than $4 billion in combined sales in 2019.

Workplace sales include defined contribution plans in addition to disability and life insurance products sold at the workplace. Institutional sales include defined benefit plans, bank-owned life insurance, investment-only and pension risk transfer solutions, and funding agreements.

Consolidated Statutory Results1

Policyowners’ Dividends2 (In Millions)

Our 2019 policyowners’ dividends exceeded $1.6 billion for the fifth year in a row, affirming our commitment to operate for the benefit of our eligible participating policyowners.

Total Adjusted Capital (In Billions)

Total adjusted capital grew to a record $24.5 billion, an increase of 23 percent from 2018, which underscores our enduring financial strength.

Life Company Assets (In Billions)

Life company assets grew 10 percent in 2019 and reached an all-time high of $280 billion.

  1. These are consolidated statutory results of Massachusetts Mutual Life Insurance Company and its U.S.-domiciled life insurance subsidiaries: C.M. Life Insurance Company and MML Bay State Life Insurance Company.

  2. Dividends are determined annually, subject to change, and not guaranteed. For more information, visit MassMutual.com/Financials.

Summary of Financial Position (Consolidated statutory basis, in Millions)

As of December 31, 2019:

2019

2018

Short-term investments and cash

4,317

4,733

Bonds

106,023

101,504

Other invested assets

85,059

70,125

Total invested assets

$195,399

$176,362

Other assets

7,876

8,048

Separate account assets

76,659

70,431

Total assets

$279,934

$254,841

Policyowners' reserves

150,458

141,073

Policyowners' dividends

1,684

1,713

Other liabilities

27,457

22,601

Asset valuation reserve

4,783

3,413

Separate account liabilities

76,659

70,431

Total liabilities

$261,041

$239,231

Surplus

18,893

15,610

Total liabilities and surplus

$279,934

$254,841

Enterprise Measures

Assets Under Management1 (In Billions)

The financial assets managed by MassMutual and our subsidiaries ended 2019 at $567 billion, reflecting the contribution of our asset management affiliate, OppenheimerFunds, Inc., to Invesco Ltd. This is partially offset by higher assets under management at Barings due to market appreciation, as well as strong cash flows across MassMutual’s protection and institutional businesses.

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, an increase of 8 percent over prior year, due to strong sales and retention rates.

Premium & Other Deposits2 (In Billions)

Results in 2019 reflect the sale of MassMutual Asia and partial sale of MassMutual Japan, offset partially by growth of domestic life insurance and institutional offerings.

  1. Assets under management include assets and certain external investment funds managed by MassMutual subsidiaries, including Barings.

  2. Premium & Other Deposits include net premiums and deposits as defined in the consolidated statutory results of Massachusetts Mutual Life Insurance Company and its U.S.-domiciled life insuranced subsidiaries: C.M. Life Insurance Company and MML Bay State Life Insurance Company, as well as premium and deposits from MassMutual’s international and asset management subsidiaries.

Summary of Operations (Consolidated statutory basis, in Millions)

As of December 31, 2019:

2019

2018

Premium income

23,099

23,262

Net investment income

8,008

8,087

Fees and other income

1,496

1,135

Total revenue

$32,603

$32,484

Policyowners' benefits

25,258

23,515

Increase in policyowners' reserves

897

3,056

Commissions, other expenses, and deductions

4,201

4,049

Total benefits and expenses

$30,356

$30,620

Net gain from operations before dividends and taxes

2,247

1,864

Dividends to policyowners

1,671

1,695

Net gain from operations before taxes

$ 576

$ 169

Federal income tax (benefit) expense

8

(159)

Net gain from operations

$ 568

$ 328

Net realized capital gains

(44)

(1,044)

Net income

$ 524

$ (716)

U.S. Insurance Sales (In Millions)
2015 2016 2017 2018 2019
$3,511 $3,840 $4,048 $6,661 $6,985
U.S. Whole Life Sales (In Millions)
2015 2016 2017 2018 2019
$876 $1,098 $1,223 $1,197 $1,205
Annuity Sales (In Millions)
2015 2016 2017 2018 2019
$2,458 $2,556 $2,709 $5,316 $5,608
Workplace & Institutional Sales (In Billions)
2015 2016 2017 2018 2019
$17.3 $18.3 $20.6 $18.3 $21.7
Policyowners’ Dividends (In Millions)
2015 2016 2017 2018 2019
$1,742 $1,609 $1,601 $1,713 $1,684
Total Adjusted Capital (In Billions)
2015 2016 2017 2018 2019
$17.3 $17.3 $17.4 $19.9 $24.5
Life Company Assets (In Billions)
2015 2016 2017 2018 2019
$222 $235 $252 $255 $280
Assets Under Management (In Billions)
2015 2016 2017 2018 2019
$425 $458 $521 $488 $567
Life Insurance In Force (In Billions)
2015 2016 2017 2018 2019
$571 $614 $670 $719 $773
Premium & Other Deposits (In Billions)
2015 2016 2017 2018 2019
$47 $46 $58 $66 $64