OLDWICK, N.J.--(BUSINESS WIRE)--Aug 2, 2018--A.M. Best has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa-” of The Ohio National Life Insurance Company and its wholly owned subsidiary, Ohio National Life Assurance Corporation (together referred to as the Ohio National Life Group ). These companies are the principal insurance subsidiaries of Ohio National Financial Services, Inc. (ONFS), which is an intermediate holding company wholly owned by Ohio National Mutual Holdings, Inc. Concurrently, A.M. Best has affirmed the Long-Term ICR of “a-” and all existing Long-Term Issue Credit Ratings (Long-Term IR) of ONFS. (See below for a detailed listing of the Long-Term IRs).

Additionally, A.M. Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “a+” of National Security Life and Annuity Company (NSLAC) (New York, NY). The outlook of these Credit Ratings (ratings) is stable. All companies are headquartered in Cincinnati, OH, unless otherwise specified.

The ratings reflect the Ohio National Life Group’s balance sheet strength, which A.M. Best categorizes as strongest, as well as its strong operating performance, favorable business profile and appropriate enterprise risk management (ERM). The group’s balance sheet strength assessment is based on its risk-adjusted capitalization being at the strongest level, good liquidity and financial flexibility. A.M. Best notes that while the group’s risk-adjusted capitalization remains at the strongest level, it has been enhanced by the issuance of surplus notes and the use of captives to support redundant statutory reserves. A.M. Best considers financial leverage and interest coverage ratios to be within acceptable ranges. Partially offsetting these positive factors is the group’s above-average separate account exposure, which contributes to potential equity market and interest rate sensitivity, although these risks are mitigated partially by hedging and the utilization of external reinsurance.

The assessments of group’s operating performance and business profile consider its overall middle-market position within the individual life and variable and fixed indexed annuity markets, its continued positive trend in individual life sales and its stable adjusted GAAP operating results. The assessment of the group’s ERM recognizes its strong risk management framework, including front-end risk management practices and sound governance structure.

The ratings of NSLAC reflect the company’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its adequate operating performance, limited business profile and appropriate ERM. The ratings also reflect the support of the company’s parent, the Ohio National Life Group. The company’s balance sheet strength assessment is based on the strongest level of risk-adjusted capitalization and a high quality investment portfolio. These strengths are offset partially by a modest business and earnings profile relative to the group, as well as unfavorable top-line trends in variable annuities.

The following Long-Term IRs have been affirmed with a stable outlook:

Ohio National Financial Services, Inc. — — “a-” on $250 million 6.625% senior unsecured notes, due May 2031 — “a-” on $300 million 6.375% senior unsecured notes, due April 2020 The Ohio National Life Insurance Company — — “a” on $50 million 8.50% surplus notes, due May 2026 — “a” on $250 million 6.875% surplus notes, due June 2042

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s web page. For additional information regarding the use and limitations of Credit Rating opinions, please view . For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view .

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KEYWORD: UNITED STATES EUROPE NORTH AMERICA NEW JERSEY OHIO

INDUSTRY KEYWORD: PROFESSIONAL SERVICES BANKING FINANCE INSURANCE

SOURCE: A.M. Best

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PUB: 08/02/2018 10:27 AM/DISC: 08/02/2018 10:27 AM

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