A large mutual life insurer says it will be paying the holders of its 4.2 million participating insurance policies an average of about $1,100 in dividends each in 2007.

The board of Northwestern Mutual Life Insurance Company, Milwaukee, has approved increasing the 2007 dividend total to $4.6 billion, up about 8.4% from the 2006 total, the company says.

Northwestern Mutual also says it will pay a dividend interest rate of 7.5% on unborrowed funds on most permanent life insurance policies.

Total dividend for holders of individual disability insurance policies will increase to $109 million, from $93 million, and total dividends for term life policyholders will increase to $84 million, from $60 million, the company says.