Indexed universal life is sold on a simple promise: participate in index gains, avoid index losses. What the sales conversation usually compresses into a footnote is that the amount of gain you actually receive is set by a cap or a participation rate that the insurance company declares, and that the illustration used to justify the premium was a projection built on the settings in effect that day. Those settings were never guaranteed to stay where they were.
Owners of Ohio National indexed universal life contracts have a second thing to sort out first. The carrier has been renamed AuguStar following a demutualization and rebrand, and indexed products are now the center of what that company sells rather than one line among many. This page explains what is genuinely guaranteed in your contract, how to compare your current statement against the original projection, and how a secondary market buyer would value the policy if selling turns out to be the better path. Pine Lake Life Solutions offers education and a free, no-obligation policy review. We do not purchase policies and we are not affiliated with Ohio National, AuguStar, or Constellation Insurance.
In This Article
- Indexed Products Are Now the Core of This Carrier
- What a Zero Percent Floor Does and Does Not Protect
- The Dials the Carrier Controls
- Comparing Your Statement to the Original Illustration
- Options If the Policy Is Behind
- How the Secondary Market Values an Indexed Contract
- Process, Forms, and Where Pine Lake Fits
- Frequently Asked Questions
Indexed Products Are Now the Core of This Carrier
Two corporate events reshaped this company. On March 31, 2022, Ohio National Mutual Holdings completed a sponsored demutualization, converting to a stock company renamed Ohio National Holdings, Inc. and becoming an independently managed subsidiary of Constellation Insurance, backed by Ontario Teachers’ Pension Plan and CDPQ. Total consideration was roughly $1 billion, including $500 million paid to eligible members in exchange for the extinguishment of their membership interests and a commitment to contribute $500 million of capital into Ohio National Life Insurance Company over four years.
Then on July 17, 2023, Constellation announced the repositioning and rebranding of the life business as AuguStar Life, describing the lineup as indexed universal life, indexed whole life, term, and bank-owned life insurance, sold through direct agents and independent marketing organizations. The legal name changes took effect October 2, 2023: The Ohio National Life Insurance Company became AuguStar Life Insurance Company, and Ohio National Life Assurance Corporation became AuguStar Life Assurance Corporation.
For an indexed policyholder that is a mildly reassuring signal: indexed universal life is a core product line here rather than a discontinued one, which generally means continued administrative attention. It is not a guarantee about crediting rates, which your contract governs.
What a Zero Percent Floor Does and Does Not Protect
The floor in an indexed universal life contract applies to index crediting. When the reference index falls, the indexed account credits the guaranteed minimum rather than a negative return. That protection is contractual.
It is not protection against the account value falling. Cost-of-insurance charges, administrative expenses, and rider charges are deducted every month no matter what the index did, so in a year where crediting is zero the account value goes down. Owners who believed a zero floor meant the policy could never lose value are describing a product that does not exist.
Find the guaranteed minimum crediting rates written into your own contract, for the fixed account and for each indexed account. Those numbers, not the illustration, are what the carrier is bound to.
The Dials the Carrier Controls
Indexed crediting is filtered through up to three mechanisms. A cap sets the maximum credited rate for the period. A participation rate credits a stated percentage of the index movement. A spread subtracts a fixed amount before crediting.
These are declared by the carrier for each new crediting period, subject to contractual minimums. The contract guarantees a minimum cap or participation rate, not the level in effect when you bought the policy. Across the industry these settings have generally moved down from the levels used in older sales illustrations.
The compounding is what does the damage. An illustration assuming a steady credited rate for thirty years builds a curve that a policy crediting less in many of those years never reaches. The gap widens quietly, then surfaces as a higher premium notice.
| Contract feature | Who controls it | What to confirm with the carrier |
|---|---|---|
| Guaranteed minimum crediting rate | Fixed by contract | The rate stated for each account option |
| Cap on indexed crediting | Declared by carrier | Current cap and the guaranteed minimum cap |
| Participation rate | Declared by carrier | Current rate and contractual minimum |
| Cost of insurance charges | Carrier, up to a guaranteed maximum | Current and guaranteed maximum scales |
| Projected lapse year | Result of all of the above | In-force illustration, three funding scenarios |
Comparing Your Statement to the Original Illustration
Pull both documents. On the original illustration, locate the projected account value for the current policy year in the non-guaranteed column. On your current annual statement, locate the actual account value. The difference is the accumulated cost of assumptions that did not hold.
Next, read what the statement says about the year just closed: the credited rate applied to each indexed account, the cap or participation rate in effect, total premium received, and total charges deducted. If charges exceeded premium plus credited interest, the account value declined even in a year the index rose.
Finally, request a fresh in-force illustration from AuguStar at current charges and declared rates, in three versions: paying the current premium, paying nothing further, and using guaranteed minimums throughout. The projected lapse year in each version should drive your decision, and it is the number a buyer looks at first as well.
Options If the Policy Is Behind
There are four realistic moves. Increase funding, which restores the trajectory if the shortfall is modest. Reduce the face amount, which lowers the cost-of-insurance charge on the net amount at risk and can stabilize a policy without adding money. Surrender for the net cash value, remembering that gain above cost basis is generally taxable. Or sell the contract.
Which one is right turns almost entirely on whether the death benefit is still needed. If a spouse, a business partner, or a dependent still relies on it, the work is to make the coverage affordable rather than to exit. If the original purpose has passed, the question becomes purely arithmetic. The one option that is rarely optimal is doing nothing until a lapse notice arrives, by which point the account value is exhausted and the alternatives have narrowed to almost nothing.
How the Secondary Market Values an Indexed Contract
A buyer models the premium it must pay to keep the contract in force against the death benefit it expects to collect, discounted to present value. Index crediting matters only through its effect on required premium. A policy with a healthy account value needs less outside funding, which raises what a buyer can pay. A drained policy needs more, which lowers it.
The insured’s age and current medical records are the dominant variable, because they set the expected holding period. Face amount determines whether the deal is large enough to draw competing bids after transaction costs. Carrier strength is the last input: A.M. Best affirmed a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of a+ for AuguStar Life Insurance Company and AuguStar Life Assurance Corporation on November 13, 2025 with a stable outlook, and a bbb+ (Good) Long-Term Issuer Credit Rating for Constellation Insurance, Inc.
No one can promise a policy will qualify or produce a particular amount. Buyers decline more files than they bid on, and an honest review will tell you when yours is likely to be one of them.
Process, Forms, and Where Pine Lake Fits
If a sale proceeds, it closes when the carrier records a change of ownership. Ohio National’s Ownership Change Request form, V-4611, states that it must be received within 90 days of the signature date, and that additional requests submitted in conjunction with a change of ownership must be signed by the new owner and dated on or after the ownership change request. A separate absolute assignment form, 9324-ON, exists for policy assignments. Form numbers can change across a rebrand, so request the current packet directly.
AuguStar publishes a life and disability income service line at 800-366-6654, staffed 8:30 a.m. to 5 p.m. Eastern, Monday through Friday, with mail to P.O. Box 237, Cincinnati, OH 45201-0237 and servicing forms available after logging in at augustarfinancial.com.
Pine Lake Life Solutions does not purchase policies and is not affiliated with, endorsed by, or connected to Ohio National, AuguStar, or Constellation Insurance. We provide a free, no-obligation review of your illustration, statement, and surrender value, and cannot guarantee eligibility or value. Confirm tax treatment with your own CPA or tax attorney.
Frequently Asked Questions
Who services my Ohio National indexed universal life policy now?
AuguStar. Effective October 2, 2023, The Ohio National Life Insurance Company was renamed AuguStar Life Insurance Company and Ohio National Life Assurance Corporation became AuguStar Life Assurance Corporation, following the March 31, 2022 sponsored demutualization that placed the business under Constellation Insurance. The published service line is 800-366-6654.
Is indexed universal life still an active product line for this carrier?
Yes. When Constellation announced the rebrand on July 17, 2023, it described AuguStar Life’s lineup as indexed universal life, indexed whole life, term, and bank-owned life insurance, distributed through direct agents and independent marketing organizations. An active product line generally receives more administrative attention than a closed one.
Can the carrier lower my cap or participation rate?
Caps and participation rates are generally declared for each crediting period, subject to minimums stated in the contract. What is guaranteed is the minimum, not the level in effect at the time of sale. Ask the carrier for the currently declared rates and for the contractual minimums, and get both in writing.
Why is the account value lower than my original illustration projected?
Because the illustration assumed a steady credited rate that actual crediting did not match every year, while monthly charges were deducted regardless. The shortfall compounds over decades. A fresh in-force illustration at current charges and current declared rates shows where the policy actually stands and when it is projected to lapse.
Does Pine Lake buy indexed universal life policies?
No. Pine Lake Life Solutions does not purchase policies and has no affiliation with Ohio National, AuguStar, or Constellation Insurance. We offer education and a free, no-obligation policy review so you can weigh increasing funding, reducing the face amount, surrendering, or selling using real numbers from your own carrier.
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Related Reading
- Sell My Ohio National Universal Life Policy
- Sell My Ohio National Whole Life Policy
- Sell My Ohio National Variable Universal Policy
- How To Read In Force Illustration
- How To Compare Life Settlement Offers
- Evaluating Life Settlement Offer
- Cost Basis Life Settlement
- Carrier Change Of Ownership Requirements
Pine Lake Life Solutions does not purchase life insurance policies and does not provide legal, tax, or investment advice. Information provided is for educational purposes only. Eligibility for any option, including life settlements, is not guaranteed and depends on individual circumstances, policy terms, underwriting, and market conditions. Consult independent legal, tax, or financial professionals before making decisions regarding a life insurance policy.