Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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Aflac vs. Auto-Owners Life Insurance Company

Comparing Aflac, Inc. to Auto-Owners Life Insurance Company (“AOLIC”) is like comparing a supermarket to the corner convenience store. Aflac is an insurance provider giant and carries a much broader range of insurance products.

AOLIC, on the other hand, is a small insurance company that concentrates on only a limited number of insurance products. Nevertheless, Aflac and AOLIC are both financially secure insurance companies with solid reputations.

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Who is Aflac?

Founded in 1955, Aflac is the nation’s largest provider of supplemental insurance. Aflac offers a variety of supplemental insurance products that pay for things that major medical insurance will not, such as medical deductibles, certain hospital expenses and expenses associated with particular illnesses. Aflac’s various plans also provide cash to cover the rent or mortgage, car payments, utilities and groceries. Aflac offers term and whole life insurance as well.

Aflac sells its products to individuals and through employers at no cost to employers (meaning that the premiums are 100% employee-paid). Aflac does business in all 50 states, Guam, Puerto Rico and the Virgin Islands.

Aflac ranked 125 on the 2011 Fortune 500 list of America’s largest companies. Aflac was named as one of America’s Most Admired Companies and one of the World’s Most Ethical Companies by Fortune and Ethisphere magazines, respectively.

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Who is AOLIC?

AOLIC is part of a larger group of insurance companies which collectively have been doing business for nearly a century. AOLIC is a subsidiary of Auto-Owners Insurance Group (AOIG), a Fortune 500 company comprised of five property and casualty insurance companies and one life/health/annuity insurer (AOLIC).

AOLIC offers life, home, auto, business, short-term and long-term disability and long-term care insurance. AOLIC serves individuals and businesses in 26 states through independent agencies only.

Beating out 750 other life/health companies, AOLIC was listed in 2011 Ward’s Top 50 life/health companies because of AOLIC’s superior financial performance over the past five years.

What Do Aflac and AOLIC Have in Common?

There are only two products that Aflac and AOLIC both sell: short-term disability insurance and life insurance. However, unlike AOLIC, which writes short-term disability policies for individuals, Aflac offers short-term disability coverage only through employers.

Therefore, comparing the two companies’ short-term disability products would not be meaningful. But a meaningful comparison can be made with respect to life insurance because both companies make it available for individual purchase.

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What Types of Life Insurance Do Aflac and AOLIC offer?

Aflac and AOLIC both offer term life insurance and ordinary whole life insurance. AOLIC also offers universal life insurance, which is much like whole life, but because Aflac does offer that type of policy, it will not be discussed here.

  • What is Term Life Insurance?

AOLIC answers the question “what is term life insurance?” Term life insurance pays a death benefit for a specific period of time, usually 10, 20 or 30 years. Term life insurance does not provide cash value. On the death of the insured, a term policy pays only the face amount to the named beneficiary. The premiums are locked in for the length of the policy, and the coverage expires at the end of the term, unless the policy is renewed.

  • What is Ordinary Whole Life Insurance?

Ordinary whole life insurance provides a death benefit along with an accumulation of a tax-deferred, cash value. A portion of the premiums goes into a cash value account that grows tax-deferred over time. Whole life policies earn cash value and dividends based on the investments of the insurance company. The insured can borrow against, collect or use the cash value to pay the premiums.

Like term life insurance, the same monthly premium is locked in for the life of the policy. Whole life insurance policies remain in force for life as long the premiums are paid. With ordinary whole life insurance policies, the named beneficiaries do not receive the cash value when the insured dies; they receive only the face amount of the policy.

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How Do the Two Companies’ Term Life Insurance Policies Fare Against Each Other?

Term life insurance is easy to compare. Take for example a 50-year-old, non-smoking male whose lifestyle and personal and family medical history make him eligible for the premium rate, or the lowest rate that an insurance company can offer. What would he pay monthly for a 20-year term, $250,000 life insurance policy?

With Aflac, his premium would be $193 per month. With AOLIC, his premium would be $66 per month. Interestingly, Aflac’s quote was not based on any lifestyle or medical factors. It was simply based on the man’s age, the face value of the policy and the coverage term of the policy.

Lifestyle and medical factors would become an issue only at the underwriting stage, where Aflac would make the decision to approve or deny the application. In contrast, AOLIC considered the man’s lifestyle and medical history, as well as the proposed terms of the policy, in quoting its monthly premium.*

How Do the Two Companies’ Whole Life Insurance Policies Fare Against Each Other?

It is the investment component of whole life insurance policies that makes them difficult to compare. The key to choosing a particular company’s whole life policy is the internal rate of return, or the yield on the policy. The yield on the policy depends on how the insurance company invests the premiums.

It takes a competent analysis to determine the the minimum amount of cash value that can be derived from a policy at any given time interval. Only an expert can tell whether a particular company’s whole life insurance policy is or will become a decent investment. Consequently, a comparison of the Aflac’s and AOLIC’s whole life insurance policies is beyond the reach of this article.

How Do Aflac and AOLIC Compare Financially?

The financial standing of the insurance company is a critical concern in choosing a 20-year or 30-year term policy or a whole life policy. After all, the company should be solvent when the time comes to pay the policy amount.

Now AOIG, the parent company of AOLIC, dwarfs in size to Aflac. In 2010, AOIG earned $5.3 billion in revenue and reported $15.3 billion in total assets. In contrast, Aflac earned $20.7 billion in revenue, more than AOIG’s total assets, and reported $101 billion in total assets in 2010.

But the size of a company is not necessarily proportional to its financial strength. In 2011, the four largest ratings companies, Standard & Poor’s, Moody’s Investor Services, Fitch and A.M. Best, rated Aflac’s and AOIG’s financial outlooks and their ability to meet ongoing insurance policy and contract obligations as “excellent” of higher.

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Aflac or AOLIC: Which is the Better Life Insurance Company?

Aflac and AOLIC are both financially stable and reputable companies that will be around for a very long time. In terms of buying term life insurance from either company, the only issue is price. Finding out price is as easy as a phone call to Aflac and to one of AOLIC’s independent agents.

With respect to whole life insurance, the issues are price and whether a whole life policy is worth the investment. Finding an independent expert in whole life insurance policies is key to making an informed decision about whether to buy whole life insurance and whether to buy it from Aflac or AOLIC.

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