AuguStar Financial At a Glance: Rates, Products and Reviews

3.6

Annuity.org Star Rating

AuguStar Financial

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Our Take

With about $70 million in annual direct premiums sold, AuguStar Financial is far from a major player in the annuity space. But it does have a solid mix of offerings, ranging from fixed index annuities and MYGAs to SPIAs.

Pros

• Strong financial strength
• Solid fixed index options

Cons

• High NAIC Complaint Index score

Products Offered by AuguStar Financial

AuguStar Financial’s annuities are divided into three categories: fixed index, MYGA and single premium immediate.

Fixed Index Annuities

AuguStar advertises three different fixed index annuities, which are generally similar products.

The first of these is the OrionShield℠. This product allows customers to participate in market growth while still being protected from potential downturns and losses.

Some add-ons are available as well, including the Premium Bonus Rider. This feature adds a percentage of your annuity premium as a bonus credit to the annuity’s value.

Also offered is the Guaranteed Accumulation Protection benefit, which guarantees that your annuity will always experience at least some growth. This is an advantage over many other annuities where the guaranteed return or “floor” is set at zero.

AuguStar also advertises the Orbiter℠ Growth and Orbiter℠ Income fixed index annuities. The Orbiter Growth includes a contractual floor, several different crediting options and up to 10% penalty-free withdrawals while the Orbiter Income includes different strategies and participation rates.

Multi-Year Guaranteed Annuities

AuguStar Financial sells two different versions of its MYGAs: the LunarLock℠ and the LunarGuard℠.

Both products include a minimum of $10,000 with a maximum of $2 million, including higher guaranteed growth rates for amounts of $100,000 or more. This is referred to as the “High Band” of the annuity rate.

Terms of three, five or seven years are available on each product, with surrender charge rates starting at 9% and gradually declining each year from there.

The LunarLock also allows up to 10% withdrawals without facing a penalty, while the LunarGuard allows for 12%.

Single Premium Immediate Annuities

In addition to its fixed index and MYGA offerings, AuguStar Financial sells a single premium immediate annuity (SPIA).

SPIAs are simple products that often don’t have much variation across providers. AuguStar’s product can be used to convert a lump sum into a guaranteed and lifetime stream of payments.

I typically steer clients towards any company that may have high ratings of financial strength, and AuguStar Financial meets this mark. However, the noticeably high complaint records for their products are concerning. If these products seem to fit your needs, it may be worthwhile to establish a close relationship with an agent or broker who offers these products so that you have a person to work with if issues arise, rather than having to reach out directly to the company’s service team. Additionally, take care to understand exactly how these products work to ensure there are no misunderstandings during the application phase.

Stephen Kates, CFP®, Licensed Life Insurance ProducerPrincipal Financial Analyst for Annuity.org

Stephen Kates, CFP® is a personal finance expert specializing in financial planning and education. He serves as the Principal Financial Analyst for Annuity.org, where he delves into industry trends to support consumers and financial advisors on wealth management, annuities, retirement planning, and investing.

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About AuguStar Financial

If you are unfamiliar with AuguStar, it may be because it’s a new identity for an old company.

Ohio National Life was founded in 1909 and operated under that name for years. But the company was purchased by Constellation Insurance in 2022 and a rebrand soon followed in 2023.

The name “AuguStar Financial” refers to two companies: AuguStar Life and AuguStar Retirement, with the latter handling annuity sales and the former focusing on life insurance.

Constellation Insurance oversees more than $34 billion in assets under management.

Credit Ratings

Credit ratings for annuity providers can help determine a company’s financial strength and stability — an indication that it will be around to guarantee payments to you in the future. Different rating companies use different scales.

AuguStar Financial’s Credit Ratings

What Customers Are Saying About AuguStar Financial

From a sales perspective, AuguStar Financial is primarily a life insurance company. Its 2022 direct premiums sold for individual life insurance was over $530 million, while its annuity sales capped at around $70 million.

For this reason, there is not a lot of readily available information on customer satisfaction or experience. The company is absent from both the 2022 and 2023 editions of the J.D. Power Overall Customer Satisfaction Index.

But one potential red flag is the company’s NAIC Complaint Index score, which is much higher than many of AuguStar’s key competitors.

The National Association of Insurance Commissioners (NAIC) tracks the consumer complaints that each state’s insurance commission receives each year. These are used to compile a company’s NAIC Complaint IndexNAIC Complaint IndexDetermined by dividing the company’s share of complaints in the U.S. market by the company’s share of premiums in the U.S. market. The National Complaint Index is always 1.00, so a score of 2.00, for example, is twice as high as expected in the market..

NAIC Complaint Index for AuguStar Financial

AuguStar Financial Pros & Cons

AuguStar Financial provides solid potential benefits for customers, but there are concerns to note as well.

Pros

• It may not be obvious given the new name and identity, but AuguStar Financial is an old, stable and trustworthy company. It has been in the industry for decades and holds strong financial strength ratings from AM Best and Fitch.
• The company also provides a solid mix of annuity options, with both its fixed index and MYGA offerings standing out as solid potential choices depending on your financial needs and personal circumstances.

Cons

• One major potential con to be aware of is AuguStar’s 10.82 NAIC Complaint Index Score.
• This means that there are nearly 11 times as many customer complaints than expected against AuguStar given its size in the marketplace.
• While this information can be interpreted in different ways, it may be worth considering for those who place an importance on customer satisfaction.

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Provider Rating Methodology

Annuity.org created a fact-based methodology to analyze the strength, security and reach of different annuity providers. We assessed companies based on their availability, the amount of direct premiums sold, their AM Best Financial Strength Rating and their NAIC Complaint Index score.

Providers received a rating on a five-star scale for each of these categories, with the complaint index and financial strength ratings weighed as the heaviest variables. Then, using a weighted average, each company was assigned an overall star rating.

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Our Rating Panel

The Annuity.org editorial team spoke with several different annuity experts to learn more about what is important to customers when searching for a provider and what factors make a company reliable. While Annuity.org designed the methodology, these experts provided feedback during the process and consulted on what factors we should leverage to best help prospective buyers compare providers.