Annuity providers must be licensed to do business in different states. Given Ohio’s size, many of the major carriers are licensed to sell annuities within the state. Ohio is ranked 6th in the nation for domestic insurance carriers licensed in the state in 2022, according to a 2022 NAIC report. Explore current annuity rates available in Ohio using the table below.
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| Product |
Rate
|
Guarantee Period
|
Surrender Period
|
AM Best Rating
|
|---|---|---|---|---|
|
GCU Insurance 1 + 4 Choice |
4.25% | 1 Years | 5 Years | A- |
Access SPDA |
3.25% | 4 Years | 4 Years | A- |
|
Access SPDA |
3.45% | 6 Years | 6 Years | A- |
|
Security Benefit Life Insurance Company Advanced Choice |
4.85% | 5 Years | 5 Years | A- |
|
Security Benefit Life Insurance Company Advanced Choice |
4.85% | 7 Years | 7 Years | A- |
|
Security Benefit Life Insurance Company Advanced Choice |
4.60% | 3 Years | 3 Years | A- |
Advantage 5 Advisory |
5.05% | 5 Years | 5 Years | A++ |
|
American Life & Security Corp American Classic |
5.05% | 5 Years | 5 Years | B++ |
|
American Life & Security Corp American Classic |
5.20% | 3 Years | 3 Years | B++ |
|
American Freedom Aspire 3 |
4.45% | 3 Years | 3 Years | A++ |
Buying an Annuity in Ohio
Since annuities are regulated at the state level, some specific rules and the overall buying experience can vary depending on where you live.
Fortunately, Ohio’s high population helps give residents access to a many annuity providers and the chance to find a product best suited for one’s needs.
Ohio also has some built-in protections for annuity buyers, including a mandated free-look period of at least 15 days for some annuities, where a customer can return an annuity contract without facing any kind of penalty.
Additionally, information on annuities is publicly available through the Ohio Department of Insurance to help residents make the right financial decision for themselves.
Buying an annuity in Ohio can generate substantial lifetime income compared to the state pension system. Although the paperwork for a 1035 transfer can be challenging (requiring snail mail and original wet signatures), the high lifetime income payoff is worth it.
From personal experience, I’ve noticed that when Ohio residents consider alternative annuity options outside of their current employer or state-sponsored pensions, they almost always achieve a much higher payout by choosing another annuity provider.
John Stevenson, CFFOwner and Advisor at Stevenson Retirement SolutionsJohn Stevenson, a Certified Financial Fiduciary®️, specializes in securing retirements with tax-free accounts. With a focus on guaranteed retirement, he’s ensured none of his clients suffer from market fluctuations. As a renowned educator and podcast host, John empowers thousands weekly, sharing his expertise in minimizing taxes and protecting against financial downturns.
Looking To Buy an Annuity in Ohio?
Annuity Regulations and Taxation in Ohio
Ohio is among the 40 states that have embraced the latest revisions of the NAIC Suitability in Annuity Transactions model, aiming to protect annuity customers from potential predatory practices.
Aamir Chalisa stresses the significance of comprehending state regulations regarding annuities and the accompanying rules. He asserts that a crucial aspect of the retirement planning process involves understanding the various available products and the unique regulations associated with each state. Ohio, for instance, has distinct rules surrounding annuities that consumers should be aware of. Aamir ensures that his clients grasp these rules clearly at the time of sale. His clients particularly value the tax-deferred status of their investments, as they only incur taxes upon withdrawal, facilitating compounding over time.
Moreover, Ohio offers several advantages, including a longer free look period, exemption from sales tax and protection from creditors. These nuances attract numerous annuity companies to sell their products within the state, ultimately leading to happy customers.
According to the NAIC, Ohio’s adoption of the latest revisions mandates recommendations made by agents or providers to be in the best interest of the customer.
Furthermore, Ohio does not levy an annuity premium tax. However, it’s important to note that Ohio imposes a state income tax. Annuities operate as tax-deferred products, meaning taxes are deferred until the annuity pays out. Importantly, Ohio’s state income tax rate is notably lower than that of other large states like New York and California, allowing annuity holders to retain more of their income.
Ohio Resources
Many resources that can assist potential annuity customers are available through the Ohio Department of Insurance. This includes guides on buying an annuity and tips on how to avoid buying the wrong product.
Ohio Department of Insurance Resources
- Guide to Buying an Annuity
- Avoiding Unsuitable Annuity Products
- Guide to Life Insurance and Annuity Contracts
Additionally, the Cleveland Plain Dealer put together a collection of questions for Ohioans to consider when looking into buying an annuity.
More information on the latest Suitability in Annuity Transactions model adopted by Ohio can be viewed here.
The Tax Foundation also provides on state income tax rates to help Ohioans determine how much they will owe.
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Frequently Asked Questions About Annuities in Ohio
Ohio is one of 40 states to adopt the latest addition of the NIAC Suitability in Annuity Transactions Model Regulation. This provides additional protections for buyers, including ensuring that agents and carriers emphasize what is in the customer’s best interest and whether a product is suitable for them.
Ohio is not one of the seven states that taxes annuity premiums, but it does have a state income tax. This means taxes will be owed when your annuity begins to pay out.
According to Ohio law, annuities are not subject to claims from creditors.
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