Ohio National Life Insurance Company Review

Officially known as Ohio National Financial Services, Ohio National Life Insurance Company has been an innovative force in the life insurance industry for over a century. While many of its competitors have scaled down on their options, the company continues to offer a full range of life insurance products.

Ohio National Life Insurance Company currently hold an A+ (superior) rating for financial strength from the respected independent insurance industry watchdog A. M. Best. Some of the company’s other recent ratings include an AA (very strong) from Standard and Poor’s and an A1 rating from Moody’s.

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History and Structure

Ohio National Life Insurance Company was founded in 1909 in Cincinnati. It issued its first life insurance policy the following year. Also in 1910 the company made its first acquisitions, purchasing the Toledo Life and Seven States insurance companies. Ohio National continued making acquisitions during the height of the Great Depression, acquiring three other companies between 1930 and 1933. Acquisitions continued on a fairly regular basis until World War II.

The company is an innovator in the life insurance industry, offering its first group life policies in 1955, its first variable annuities in 1970, its first universal life policy in 1982 and its first variable universal life in 1987. Running somewhat counter to recent trends, Ohio National Life Insurance Company was originally a stock company but became a mutual insurance company later in its history. The change occurred in 1959.

In 1996 Ohio National relocated its headquarters to the Cincinnati suburb of Montgomery, Ohio. Today Ohio National is licensed to operate in every state except Alaska, Hawaii and New York. The company employs agents through its “Producing General Agent (PGA)” and career programs. Life insurance policies written by Ohio National are issued by The Ohio National Life Insurance Company and Ohio National Life Assurance Corporation. Ohio National Equities, Inc. distributes the company’s variable products.

Term Life

The following product discussions are intended to be a generic representation of the policies Ohio National Life Insurance Company offers. Not all products may be available in every state as described. In addition policy features and underwriting requirements may change without notice. Consult with a Ohio National Life Insurance Company agent for the most up-to-date information.

Ohio National Life Insurance Company offers term life insurance in 10- 15- and 20-year plans. All policies are convertible to permanent life products in certain situations, although the “Plus” term policies offers considerably more liberal permanent life insurance conversion criteria than the less expensive “Basic” policies.

Depending on health, policies can be underwritten in one of three classes better than standard rates: Select, Preferred and Super Preferred. In addition term insurance underwritten by Ohio National Life Insurance Company offers waiver of premium and children’s term riders.

Whole Life

Ohio National Life Insurance Company features four different whole life insurance products. The Prestige Value II, a basic whole life plan, is the most affordable of the company’s whole life products. The Prestige Performance is geared towards a better rate of return in its cash value during a shorter period, while the Prestige Xcel is designed for a better rate of return in the long term. Finally, the Prestige Max is permanent coverage designed to be paid in full at age 65 or 10 years after policy issuance, whichever comes later.

All Ohio National Life Insurance Company whole life products offer dividends. These dividends can be used to increase cash value and death benefit over time. While the dividends are dependent on company performance and are not contractually guaranteed, Ohio National has paid dividends on its in-force policies for over 80 consecutive years.

Universal Life

Ohio National Life Insurance Company’s two traditional universal life (UL) products provide the standard cash value mechanisms and flexible payment options one would expect on a UL policy. The Virtus Value II is a typical UL, while the Virtus Basic is geared towards juveniles and individuals converting their Ohio National “Basic” term life insurance policies.

The Virtus VUL is a variable universal life policy which features a cash value mechanism driven by separate accounts chosen according to the insured’s risk tolerance. Separate accounts operate in a similar manner to mutual funds. While the rate of return on the cash value of a VUL can outpace similar UL products in the long term, because of its nature it is possible to lose money on these products.

VUL policyholders can choose from a wide range of separate accounts ranging from conservative to aggressive. These separate accounts are managed by respected third-party asset management companies such as American Century, Fidelity, Janus, Goldman Sachs and several others.

Annuities and Other Products

Ohio National Life Insurance Company features three fixed annuity products which people with low investment risk tolerances may find attractive. The Foundation and Secure Annuity products are single premium or “one-pay” annuities which are funded by a single, substantial payment. The Secure Annuity is a single premium immediate annuity, or SPIA, which begins its monthly income distribution phase immediately. The Foundation is a deferred annuity, designed to begin its distribution phase at a later time. Single premium annuities are often beneficial for tax and estate planning purposes when one acquires a large lump sum of money, such as from an inheritance.

The Prime II is a flexible premium fixed deferred annuity which one can contribute to in many payments over time before the distribution phase begins. Ohio National offers flexible payments on the Prime II, allowing the policyholder to start, stop or change payments at any time.

Ohio National Life Insurance Company offers several variable annuity options as well, including the ONcore Lite II, ONcore Lite III and ONcore Ultra II products, which feature short four-year surrender charge schedules. Another product, the ONcore Flex II, has no surrender charge schedule at all, which is quite unusual in the industry.

Separate account assets can be allocated in predetermined asset allocation models ranging from conservative to aggressive, or the policyholder can choose to allocate the assets on his or her own. A dollar cost averaging feature, which periodically transfers assets from a fixed account to the separate accounts, is also available. The available separate accounts are managed by third-party asset management companies similar to those available in the variable universal life policies.

In addition to its life insurance products, disability income insurance (DI), non-annuity retirement plans and securities such as mutual funds are available from  Ohio National Financial Services. The company also provides 529 college savings plans, group retirement products and other financial services.

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