Ohio National Financial Services made a surprise announcement Tuesday that president and COO Christopher Carlson is retiring three months after taking the position.
Carlson leaves two months after the company made the stunning decision to break contract agreements with advisors who sold specific variable annuities. That unprecedented decision eliminated future trail commissions for those advisors.
One leading analyst predicted it would be "just the beginning" of many lawsuits.
Barbara A. Turner was named new president and COO. Ohio National had no comment on Carlson's departure other than it is for "personal reasons."
"I am extremely grateful for the 25 years I’ve been able to spend at this incredible organization," he said in a statement put out by the company. "This was a difficult personal decision but it in no way diminishes the confidence I have in Ohio National’s team, strategy and future.”
Carlson was named Ohio National's 10th president in 109 years on Aug. 21. The company said he would lead a "strategic review process and ... oversee the implementation of the company’s strategy going forward."
Turner, the first woman to lead Ohio National, has more than 30 years of leadership experience in the financial services industry. She joined the company in 1997 as vice president, ONESCO operations, advanced to president and chief operating officer of ONESCO in 1999, and president and chief executive officer of ONESCO in 2013.
She was appointed senior vice president, annuities strategic business in January 2015, executive vice president and chief administrative officer in January 2016, and vice chairman and chief administrative officer in August 2018.
“Barbara’s decades of experience at Ohio National and in the financial services industry give her great perspective on the dynamic landscape in which we operate and deep knowledge of Ohio National’s operations,” said Gary T. “Doc” Huffman, CLU, ChFC, chairman and chief executive officer. “Barbara has excelled in every assignment she has received at Ohio National, consistently demonstrating outstanding leadership skills and business judgment."
Ohio National's decision to eliminate trail commissions is believed to be the first of its kind in the industry and affects variable annuity contracts purchased with a guaranteed minimum income benefit rider. The GMIB is appealing to clients looking for guaranteed income in retirement.
Ohio National informed broker-dealers in a Sept. 28 letter that it will terminate "any and all servicing agreements" on Dec. 12. The company has been sued twice so far by broker-dealers.
In addition to its decision to stop paying trail commissioners, Ohio National followed up with an Oct. 29 email to clients offering a buyout of the VA contracts with the GMIB rider.
Ohio National distributes life and annuities through an independent producing general agent channel with about 11,000 agents, and through a career agency channel with about 4,000 agents, the company said. Career agents are apparently unaffected by the decision to stop paying trails on VAs with a GMIB.
InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at email@example.com.
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