Yes — an Ohio National universal life policy can be sold in a life settlement, because the contract is your personal property and a buyer purchases it from you; the insurer’s permission is not required. Universal life is, in fact, the policy type most often sold on the secondary market. Its flexible structure is exactly what makes it fragile in later years — and what makes it valuable to a buyer willing to keep paying.
Before you do anything else, confirm who services your contract. Ohio National, founded in Cincinnati in 1909, converted from a mutual holding structure into a stock company under Constellation Insurance Holdings — an investor group backed by the Ontario Teachers’ Pension Plan and CDPQ — in a deal announced in 2021 and completed the following year. Verify current ownership, servicing entity and any later rebranding with the phone number printed on your own statement, since these arrangements keep evolving.
This guide explains how universal life is valued in a settlement, why the in-force illustration at current charges is the single most important document, and what the timeline looks like. Pine Lake Life Solutions is not affiliated with Ohio National or Constellation Insurance.
In This Article
- Why Universal Life Is the Most-Settled Policy Type
- The In-Force Illustration Is the Key Document
- What Moves a Universal Life Offer Up or Down
- Death Benefit Option A vs. Option B Matters Here
- Documents to Gather and the Assignment Step
- Timeline and the Safeguards to Insist On
- Who Qualifies, and How to Find Out
- Frequently Asked Questions
Why Universal Life Is the Most-Settled Policy Type
A universal life policy is a bucket. Premiums go in, the carrier credits interest, and every month the company deducts a cost of insurance charge plus expense charges. When the bucket empties, the policy lapses and decades of premiums produce nothing.
The problem is that the cost of insurance is priced off the insured’s age. It is small at 45 and steep at 82. Policies sold in the 1980s and 1990s were often illustrated at crediting rates that no longer exist, so the interest side underperformed while the charge side rose exactly on schedule. The result is a familiar letter in the mailbox: pay a much larger premium or the policy will lapse.
That is why UL dominates the secondary market. To the owner, the required premium has outgrown the reason for the coverage. To a buyer with a long horizon and lower cost of capital, a large death benefit that can be maintained is worth real money today. The gap between those two views is what a settlement pays you.
The In-Force Illustration Is the Key Document
An in-force illustration is a projection the servicing company runs on your actual policy as it stands today. Request three versions and the picture becomes clear:
- At current charges and current crediting rate, paying the premium you pay now — how long does it last?
- At guaranteed maximum charges and the guaranteed minimum rate — the worst case the contract permits.
- Minimum premium to carry the policy to age 100 or maturity — the real cost of keeping it.
That third number is often the shock. Owners frequently discover the policy needs several times the premium they have been paying. It is also the number a buyer models, because the buyer will be the one paying it. Ask the service center in writing and allow a couple of weeks.
Bring the illustration to the review. Without it, any figure anyone quotes you is guesswork.
What Moves a Universal Life Offer Up or Down
Offers on UL policies turn on a handful of variables:
- Death benefit size. Larger face amounts carry the fixed costs of a transaction better. $100,000 is a common practical floor.
- Insured’s age and health. A shorter estimated life expectancy means fewer years of premiums for the buyer and a higher offer.
- Required future premium. The lower the cost to keep the policy alive, the more room there is in the price.
- Account value and surrender charge. Some account value can be used to fund early premiums, which helps.
- Outstanding loans. Netted out of the offer dollar for dollar, with accrued interest.
Published market data gives you the honest range: the GAO’s study (GAO-10-775) found sellers typically received roughly 10% to 35% of face value, on the order of 4 to 8 times cash surrender value. Anyone quoting you a specific figure before seeing the illustration is guessing.
| In-Force Illustration Scenario | What It Shows | Why a Buyer Cares |
|---|---|---|
| Current charges, current rate, current premium | How long the policy lasts if nothing changes | Baseline for whether the policy is at lapse risk |
| Guaranteed maximum charges, minimum rate | The worst case the contract allows | Sets the downside on future premium cost |
| Minimum premium to carry to maturity | The real annual cost of keeping the policy | This is the buyer’s ongoing obligation, so it drives the offer |
| Reduced face amount | Lower charges, smaller death benefit | An alternative to selling worth pricing first |
Death Benefit Option A vs. Option B Matters Here
Universal life contracts usually carry a death benefit option election. Option A (level) pays a fixed death benefit, with the account value absorbed inside it. Option B (increasing) pays the face amount plus the account value, which means higher cost-of-insurance charges because the carrier is at risk for more money.
If your policy is on Option B and you no longer need the growing death benefit, switching to Option A can meaningfully reduce monthly charges and extend how long the policy survives. That is worth exploring whether or not you sell, and it is a change the servicing company can quote for you.
Other levers exist too. Reducing the face amount lowers charges. Stopping premiums and letting the account value carry the policy works only if the illustration says it does — check first. Each of these is an alternative to a sale, and a decent review will walk you through them before pointing at a settlement.
Documents to Gather and the Assignment Step
The first step needs one page: the policy cover page showing the issuing company, policy number, face amount and issue date. That is enough for a free, no-obligation review.
After that: the most recent annual statement (account value, surrender value, current charges, loan balance, death benefit option) and the in-force illustrations described above.
The legal center of the transaction is the change of ownership, typically executed as an absolute assignment. Ohio National’s service operation has its own current form, signature and notarization requirements — request the packet directly rather than reusing something downloaded years ago. You will also sign a HIPAA authorization so life expectancy can be estimated; keep it specific and revocable.
Timeline and the Safeguards to Insist On
From first contact to money in your account, plan on 60 to 120 days. The offer stage is fast; records and illustrations are slow.
Three protections are non-negotiable. Every offer in writing, with gross proceeds and any commission disclosed separately, so you can see what reaches you. An independent escrow agent holding the funds, released only when the insurer confirms the ownership change. And a clear understanding of your state’s rescission window, which lets you unwind the transaction for a defined period after funding.
Also think through the knock-on effects before you sign: proceeds may affect means-tested benefit eligibility, and the tax treatment of settlement proceeds is its own subject. Talk to your own tax advisor and, if Medicaid is in the picture, an elder law attorney. Nothing here is tax or legal advice.
Who Qualifies, and How to Find Out
The typical qualifying profile: insured around 65 or older, or younger with meaningful health conditions; death benefit of $100,000 or more; policy in force at least two years; premiums that are real but not crushing for a buyer. Universal life clears these bars more often than any other type, which is why it makes up the bulk of the market.
The only way to know about your specific contract is to have someone look at it. Send the policy cover page for a free review, or call (305) 209-7183. Start with what policies qualify, compare against surrendering the policy, and read up in the education center. If you hold other Ohio National contracts, see selling an Ohio National indexed universal life policy or an Ohio National variable universal life policy.
Frequently Asked Questions
Can I sell a universal life policy that is about to lapse?
Often yes, and it is one of the most common reasons people sell. A policy at lapse risk still has a death benefit a buyer can preserve by paying the premiums. Act before the grace period expires, because a lapsed policy generally cannot be sold.
Why did my premium suddenly increase so much?
Universal life deducts a cost of insurance that rises each year with the insured’s age, while credited interest may have run below the original illustration for decades. When charges outpace credits, the account value drains and the carrier requires a larger premium to keep the policy in force.
Does Ohio National have to agree to the sale?
No. The policy is your property and the buyer purchases the contract from you. The servicing company’s role is limited to recording the new owner and beneficiary after closing; it cannot block the transaction.
How do I get an in-force illustration?
Call the policyholder service number printed on your most recent statement and request an in-force illustration at current charges, at guaranteed maximum charges, and showing the minimum premium to carry the policy to maturity. Requests are usually made in writing and can take a couple of weeks to fulfill.
How much might my universal life policy sell for?
The GAO’s market study (GAO-10-775) found sellers typically received about 10% to 35% of face value, roughly 4 to 8 times cash surrender value on average. Your figure depends on age, health, the death benefit, the premium required to keep the policy in force, and any outstanding loan.
Should I switch from death benefit Option B to Option A first?
It is worth pricing. Option B pays the face amount plus account value and therefore carries higher cost-of-insurance charges. If you no longer need the increasing death benefit, switching to Option A can lower charges and extend the policy, whether or not you end up selling.
What do I have to send to start a free review?
Only the policy cover page — the first page showing the issuing company, policy number, face amount and issue date. There is no cost and no obligation. If the policy looks like a candidate, the next step is the annual statement and an in-force illustration.
Find out what your policy is worth — free, confidential, no obligation.
A 15-minute educational review covers your eligibility, every alternative, and a realistic view of what each path would net you.
Related Reading
- What Policies Qualify For Life Settlement
- Life Settlement Vs Surrender
- Education Center
- How It Works Policy Options
- Sell My Ohio National Indexed Universal Policy
- Sell My Ohio National Variable Universal Policy
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.