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Colonial Penn offers two types of whole life insurance coverage that can help cover the cost of burial expenses and other more minor end-of-life expenses. Their $9.95 life insurance plan is heavily marketed on television to the age 50-85 market as the #1 most popular whole life insurance plan. Acceptance is guaranteed and does not require a medical exam or answers to any health questions. Coverage also lasts your entire life. Colonial Penn Pros
Colonial Penn Cons
Obtaining a burial insurance policy can give you and your loved ones more peace of mind. In addition, it can cover the costs associated with burial, funeral arrangements, and other final expenses to help reduce the financial burden on beneficiaries. Colonial Penn is one of many companies offering burial insurance with affordable coverage options starting at $9.95 a month. Colonial Penn is also a recognizable insurance company, primarily due to the decades of television commercials featuring Alex Trebek, Ed McMahon, Jonathan Lawson, and other celebrities. The commercials often highlight the affordability of Colonial Penn’s life insurance policies, which start at just $9.95. So, are Colonial Penn’s life insurance options a good choice, or is it a scam? Before purchasing life insurance, you should always explore the full details of the policy and even compare coverage options from other insurance companies. In this Colonial Penn life insurance review, we examine the details of the company’s whole life insurance and guaranteed acceptance policies for you. Keep reading to learn more about both insurance plans’ coverage amounts, age limits, and application process. Colonial Penn Life Insurance CompanyColonial Penn Life Insurance Company was founded by one of the co-founders of AARP in 1968. At the time, Colonial Penn was one of the only insurers to offer a guaranteed acceptance life insurance plan for Americans aged 50 and over. Over 50 years later, Colonial Penn continues to specialize in offering life insurance products to seniors and those approaching retirement. The company is well-known for its commercials and pitch for affordable guaranteed acceptance coverage starting at $9.95 per month. Along with guaranteed acceptance life insurance, Colonial Penn offers final expense insurance and a critical illness supplemental insurance plan. You can apply for most policies online or call Colonial Penn to speak with a sales agent. CNO Financial Group (formerly Conseco) acquired Colonial Penn in 1997. Along with Colonial Penn, CNO Financial owns Bankers Life, Washington National, and several other major companies. However, Colonial Penn maintains its headquarters in Philadelphia, Pennsylvania, where the company started 54 years ago. Colonial Penn Life Insurance Ratings & ReviewsWhile Colonial Penn is a recognizable brand, you should learn more about its financial strength and customer satisfaction track record. The financial strength of an insurance company is important, as you want to ensure that the company will stick around long enough to pay claims if necessary. Here are how the leading independent rating agencies rated Colonial Penn:
While Colonial Penn has a positive financial outlook based on the opinions of the above independent rating agencies, the company appears to receive a higher rate of customer complaints compared to many other life insurance companies. For example, The National Association of Insurance Commissioners NAIC notes that Colonial Penn Life Ins Co has a customer complaint ratio of 4.29. This number is above the median complaint ratio for all insurance companies of 1.00. Companies with a score below 1.00 demonstrate that they have received fewer than average customer complaints. Conversely, a score above 1 means the insurance company received a high volume of customer complaints. For example, the total number of customer complaints received on Colonial Penn for 2021 was 111. Colonial Penn is also a BBB-accredited business with an A+ rating from the Better Business Bureau. However, since becoming an accredited business in 2020, they have had an overwhelming 222 customer complaints within the last three years, all of which have been responded to and closed. What are some of the main customer complaints Colonial Penn has received?
Colonial Penn Life Insurance PlansColonial Penn’s two permanent life insurance plans are predominantly marketed as burial insurance or final expense insurance protection due to the lower maximum death benefit amounts. While each plan offers limited coverage, the amounts available are likely to cover funeral costs and other more minor end-of-life expenses. These plans also allow you to skip the need for a medical exam. These features make both plans attractive to seniors with minor or even major health issues who need life insurance. Colonial Penn offers two types of whole life insurance options that can provide coverage for your entire life:
Both life insurance options include several of the same features, including:
The company offers a streamlined underwriting process to determine your eligibility so you can get coverage quickly. You also get fixed premiums that never increase with age. While Colonial Penn offers two types of whole life insurance plans, the two policies include different coverage amounts, age restrictions, death benefit payouts, and rates. Here is a closer look at the different features offered by the two policies. Colonial Penn Individual Whole Life vs. $9.95 Plan
Death Benefit Payout
Colonial Penn Individual Whole Life Insurance is considered day one coverage. That means that as soon as your policy is active, your beneficiaries are entitled to the full death benefit payout upon your death. Colonial Penn Guaranteed Acceptance Life has a two-year graded death benefit. If death occurs within the first two policy years, the death benefit payment equals a full refund of all premiums paid plus 7% interest on those payments. After two years, your beneficiaries will receive the full death benefit. Colonial Penn will pay out the full death benefit if death does occur within the first two policy years of accidental cause. After the second policy year, the death benefit becomes fully payable to the beneficiary regardless of a health-related death or an accidental death. Graded death benefits are commonly referred to as “life insurance with a waiting period.” This type of life insurance plan is generally purchased by anyone who cannot qualify for a traditional policy that offers day one coverage, often due to high-risk health concerns. Age Availability
Colonial Penn Permanent Whole Life Insurance is available to those between the ages of 40 and 75. Colonial Penn Guaranteed Acceptance Life is for applicants between the ages of 50 and 85. In the state of New York, guaranteed acceptance is available between the ages of 50 and 75. Coverage Amounts
Colonial Penn Permanent Whole Life Insurance is available in death benefit amounts of $10,000 up to a maximum of $50,000. Colonial Penn Guaranteed Acceptance Life offers death benefits based on “units” of coverage. You can choose anywhere from 1 to 15 units, with each single unit costing $9.95 per month. However, the amount of death benefit an individual unit represents will vary depending on the person’s age and gender. To provide you with an example of how units of coverage work, let’s say you’re age 70 and want to know what 1 unit of Colonial Penn’s $9.95 coverage would get you in coverage. According to the companies on quote results, $9.95 would buy you a death benefit of $689. Now let’s say you’re age 50 and choose 1 unit of coverage. In that case, your death benefit would equal $1,669 for the same $9.95 monthly payment. The more units you choose, the larger your death benefit will be. The unit model allows you to choose how much money you want to spend on life insurance. Then, based on how much you’re willing to pay, Colonial Penn will tell you how much coverage they will give you based on your spending choice. How much does each unit of coverage cost?
*Everyone pays the same price per unit regardless of gender or age. Colonial Penn’s death benefit model on their Guaranteed Acceptance plans is unique and not common with other providers. Traditionally, when buying burial insurance coverage, the provider will have you choose a death benefit amount and provide you a price based on the death benefit amount. Instead, Colonial Penn does it entirely backwards, where you decide how much you want to spend, and they tell you how much death benefit you will get based on how much you’re willing to pay per month. To figure out how much coverage you can get per unit, you generally need to obtain a quote through the company’s website. However, we have created a Colonial Penn life insurance rate chart where we have pulled current rates directly from the company’s website showing just how much coverage you are actually getting based on the unit pricing model. Contract Duration
Both Colonial Penn whole life insurance plans include lifetime coverage. Your rates and benefit amount are locked in for the entire life of the policy. So as long as you continue making the premium payments, your insurance plan will last the rest of your life and can never be canceled. Rates
Both policies include fixed rates, which means that your rates never go up. After coverage starts, your rates are guaranteed to remain the same price for the entire life of your policy. Cash Value Growth
Both plans gain cash value with each payment after the first year. Whenever you make a monthly premium payment, Colonial Penn sets aside a predetermined amount into a cash-value account. The cash account should equal the death benefit when you reach the age of 95, providing you with a paid-up life insurance policy. While your policy grows in cash, you can save the cash value or take out a loan. A policy loan will include an interest rate of 8%, which is compounded annually. The interest rate is lower than the typical rates charged by banks for personal loans. In addition, any amount that you do not repay before death occurs is subtracted from the death benefit. Policy Riders
With each Colonial Penn whole life insurance plan, you have the option to add additional protection with an Accidental Death Benefit Rider. The rider allows you to match your base death benefit with an additional death benefit that would pay if your death was a direct result of an accident. If your death were accidental, your beneficiary would receive the base death benefit and a second accidental death benefit. Colonial Penn also offers a type of accelerated death benefit rider with its Individual Whole Life Insurance plans, called Living Insurance. However, this option is not available for the guaranteed acceptance policy. Living Insurance allows you to add an early payout option from your policy’s death benefit if diagnosed with specific health conditions, including:
You can access up to 50% of your life insurance benefit with a qualifying heart attack/stroke and chronic illness diagnosis. In addition, a qualifying cancer diagnosis allows you to access up to 25% of the death benefit. Living Insurance from Colonial Penn is a popular policy feature offered with many of today’s life insurance plans. The common name for it is life insurance with living benefits. Medical Exam Requirements
Colonial Penn does not require medical exams for either of its two life insurance options. Instead, underwriters use the answers to the health questionnaire on your application and information from third-party sources to evaluate your eligibility. You may also receive a call from an underwriter for follow-up information but never need to complete a medical exam. Guaranteed Acceptance plans do not require medical exams or health questions. Approval is guaranteed regardless of past or current health as long as you meet the age requirements for coverage. State Availability
Colonial Penn policies are not currently available in the state of New York. The company is licensed to sell insurance in 49 states, Puerto Rico, the US Virgin Islands, and Washington, DC. Colonial Penn’s parent company CNO Financial sells insurance under the Bankers Conseco Life Insurance brand in the state of New York. 2022 Colonial Penn Life Insurance Rate ChartThis section will provide a detailed look at life insurance rates for Colonial Penn’s Individual Whole Life Insurance plan and their Guaranteed Acceptance, aka the $9.95 per month plan. The rates shown in the below tables have been obtained by utilizing the instant quote tool located directly on the Colonial Penn website. To obtain a quote for life insurance coverage, you will be required to choose between their Individual Whole Life Insurance plan or Guaranteed Acceptance plan. You will then be required to provide the quote tool with your name, ZIP code, date of birth, gender, and contact information before receiving rates. After completing the short quote form, you will have access to Colonial Penn life insurance rates without speaking with an agent. However, since you must provide your contact information, you are highly likely to be contacted by a Colonial Penn representative to discuss your life insurance options. Colonial Penn Whole Life Insurance Rate Chart
Monthly male/female non-tobacco premium rates current as of 6/8/2022 representing the cost of a $10,000 / $20,000 / $30,000 / $40,000 / $50,000 Colonial Penn Individual Whole Life Insurance policy. Rates are guaranteed to remain the same for life. Colonial Penn Guaranteed Acceptance $9.95 Rate Chart
Monthly male/female non-tobacco premium rates current as of 6/8/2022 representing the cost of 1 Unit / 5 Units / 10 Units / 15 Units of Colonial Penn Guaranteed Acceptance Insurance policy. Rates are guaranteed to remain the same for life. Colonial Penn Life Insurance Frequently Asked Questions – OverviewYou now know the details of Colonial Penn’s life insurance policies but may still have some questions about the application process, eligibility, and other features. Use the following FAQ to address any lingering concerns. Is Colonial Penn Life Insurance a Scam?By no means is Colonial Penn a scam company. The number of negative customer reviews would cause us to err on the side of caution of locking into a plan with them. However, they are a legitimate insurance company backed by strong financial ratings. We will also admit that the company does an extremely high volume of business, which could likely lead to higher than average customer complaints. And to give them credit, from what we can see, they have resolved most, if not all, complaints listed with the Better Business Bureau. In addition, their whole life insurance plans do what they intend to: provide financial protection in the form of a lump-sum death benefit payment paid to your named beneficiaries at the time of your passing. Is Colonial Penn a Ripoff?Colonial Penn is far from being the cheapest company to offer burial insurance, but we wouldn’t go as far as calling them a ripoff. The company’s Individual Whole Life Insurance plan is on par with many top providers offering comparable burial insurance plans. Their major drawback with Colonial Penn is the Guaranteed Acceptance aka $9.95 plan. The whole concept is a great marketing concept, but at one unit of coverage, it’s barely enough to cover cremation costs. Even if you select the maximum 15 units of coverage, the death benefit in most cases is less than $20,000. Companies such as AIG or Gerber can offer up to a maximum of $25,000 of guaranteed issue whole life insurance, often much cheaper than Colonial Penn’s monthly rates. How Do You Apply for Colonial Penn Life Insurance?Colonial Penn life insurance plans are only available for purchase by going directly through their company. Independent life insurance agents are not eligible to sell their life insurance coverage. You can apply for Colonial Penn life insurance online or call Colonial Penn’s sales department. The online application is quick and straightforward. The application process will start with an initial quote. To receive a quote, you first need to provide some basic information, such as your age, gender, and the coverage amount. After viewing rates, you can proceed to complete an online application if you decide you want to apply for a life insurance policy with Colonial Penn. As with most products in the insurance industry, Colonial Penn’s life insurance policies require you to provide the following information:
If you are applying for an individual whole life insurance plan, you must answer a few health questions and provide your height and weight measurements. After submitting your application, the company’s underwriters will review the details, assess your risk profile, and determine whether you are eligible for a plan. If approved, you can choose from several payment options, including a direct bill in the mail, automatic deduction from a checking or savings account, and a credit card. What Determines Eligibility for Coverage?Guaranteed acceptance plans require little underwriting, with eligibility primarily based on your age. You must be between 50 and 85 years of age to be eligible. The individual whole life insurance plan does require answers to a series of medical questions listed within the application. However, as long as you are not suffering from a debilitating illness, you are likely eligible for individual coverage without a waiting period. How Much Life Insurance Coverage Do You Get for $9.95 Per Month?The $9.95 life insurance plan applies to Colonial Penn’s Guaranteed Acceptance and is the cost per unit of life insurance coverage. Up to 15 total units can be purchased, with each unit costing $9.95 per month. If you were to purchase all 15 units of coverage, the total monthly cost would be $149.25. The total coverage you receive for $9.95 will vary based on an applicant’s age and gender, but in most cases, the death benefit coverage will be $1,500 or less. Does Colonial Penn Have a Waiting Period Before The Death Benefit Will Payout?Colonial Penn’s most popular life insurance plan, Guaranteed Acceptance, has an automatic 2-year graded death benefit period. That means that immediately when your policy is active, it starts the two-wait on a death benefit payout should the policyholder pass away. Colonial Penn will only pay out a death benefit to your beneficiary equal to a refund of all premiums paid plus interest of 7% on all paid premiums. Which Colonial Penn Life Insurance Plan is Best?Colonial Penn’s individual whole life insurance plan will offer the best coverage. The life insurance plan can offer a better selection in coverage amounts and lower premiums. Plus, there is no waiting period on the death benefit payout. However, suppose you have a complicated medical history with significant health issues like heart disease or cancer. In that case, you’re not likely to qualify for an individual whole life insurance plan and will have to consider choosing a guaranteed acceptance plan where you cannot be turned down for coverage. With the median cost of a funeral with burial and a viewing costing about $7,900, either of the two plans should offer enough coverage to deal with funeral costs and other expenses. How Quickly is Approval for Coverage?It may take several days or up to two weeks for application approval. The traditional underwriting process has an average turnaround time of about four to six weeks. Colonial Penn does not require a medical exam and has a streamlined underwriting process, allowing you to receive a faster decision. What Happens After You Are Approved for Coverage?Colonial Penn will send you a notification if you are approved for coverage. In addition, a physical copy of the policy is mailed to the address you included on the application form. You can manage your policy by logging into your account online. The customer dashboard includes access to coverage amounts, cash value, payment history, and other details of your policy. Does Colonial Penn Accept People with Pre-Existing Health Conditions?Colonial Penn accepts people with pre-existing health conditions. Accepting individuals with existing health issues is one of the advantages of Colonial Penn. However, some health risks may disqualify you from getting the individual whole life policy that offers full coverage beginning the first day. For example, if you are currently hospitalized or in a nursing facility, receiving dialysis, or require assistance with daily living, you may need to apply for the guaranteed acceptance policy. Is It Possible to Increase the Death Benefit After a Policy Has Been Purchased?You cannot increase the death benefit of a policy after you have already purchased a plan. However, you can buy multiple policies through Colonial Penn if they do not exceed the maximum death benefit limits. For example, suppose you already have a $25,000 Colonial Penn life insurance policy. In that case, you may purchase up to $25,000 in additional coverage since $50,000 is the maximum death benefit amount on individual whole life insurance. Therefore, on the $9.95 plan, you may own multiple policies as long as you do not exceed 15 units. After buying a policy and deciding that you want more coverage, you can apply for a separate plan to increase the size of your death benefit. Each new policy will have a different account number. However, Colonial Penn automatically combines the monthly premiums to give you a single statement each month. How Much Does Colonial Penn Life Insurance Cost?The cost of Colonial Penn life insurance mostly depends on the applicant’s coverage amount, age, and gender. Men will receive higher life insurance rates than women of the same age and health. Older individuals also face higher rates, so getting life insurance at a younger age is often recommended. How Do You Get a Colonial Penn Life Insurance Quote?To receive a quote for Colonial Penn life insurance plans, you must contact them by telephone or visit the website. Online, you can get an instant quote using the quote form located on the website. Colonial Penn gives you instant rates after filling out a few basic details, such as your age, gender, and coverage amount. You can then decide whether you want to continue the application. How Long Does Coverage Last?Colonial Penn only offers whole life insurance coverage. Therefore, coverage lasts for life as long as you pay the monthly premiums. Your rates and death benefit are locked in and also do not change. What is the Cancellation Policy with Colonial Penn?Colonial Penn offers a 30-day money-back guarantee. If you decide that you do not want the insurance policy during the first 30 days, you can contact Colonial Penn to cancel that policy and receive a refund of the premiums you have already paid. If you cancel after 30 days, you do not receive a refund. However, if your account has accumulated cash value, you may receive the cash value minus any surrender fees and taxes. Does Colonial Penn Offer Other Types of Insurance?Colonial Penn offers supplemental health insurance called “Active Care.” The insurance plan is underwritten by Washington National Insurance Company, also owned by the parent company CNO Financial. The supplemental health insurance plan provides a lump-sum payment of up to $60,000 for several different qualifying critical illnesses. For example, you can obtain this supplemental insurance policy to cover expenses caused by cancer, heart attack, or stroke. These companies also offer critical illness insurance plans:
Colonial Penn used to offer term life insurance. However, the company stopped selling term life insurance plans in 2021. How Do You File a Colonial Penn Death Benefit Claim?You can file a Colonial Penn death benefit claim by sending specific documents to the company through the mail. You need to submit a copy of the death certificate, the original contract, and a claimant’s statement that includes the beneficiary’s name. How Do I Contact Colonial Penn Customer Service?You can contact Colonial Penn’s customer service department via phone, online form, or regular mail:
Mailing Address:
The company prefers that you call customer service for questions about your benefits and coverage. You can use the online form or write to customer service to request forms, change your beneficiary, or request a replacement copy of your policy. Pros of Purchasing a Colonial Penn Life Insurance PolicyHere are the top advantages of purchasing a Colonial Penn life insurance policy:
Colonial Penn does not require a medical exam for the whole life or guaranteed acceptance policies. Therefore, if you have existing health issues, you do not need to worry about your health history keeping you from getting insurance. Applying for insurance through Colonial Penn is also easy. You can apply online in minutes. You just need to provide some basic information and answer health questions. You should receive a decision within a week. Colonial Penn is a successful company with high financial ratings from the top rating agencies. The company consistently generates revenue, giving you peace of mind knowing that Colonial Penn can cover any claims. Colonial Penn has received a higher ratio of complaints compared to some of the leading insurance companies but also offers convenient customer service. If you have a problem, you are likely to receive a solution quickly. You can receive help online or over the phone with an English-speaking or Spanish-speaking customer service rep. Cons of Purchasing Your Life Insurance with Colonial PennColonial Penn offers quite a few advantages. However, depending on your specific needs, you may also find that Colonial Penn has the following disadvantages:
Much of the negatives to Colonial Penn stem from the $9.95 plan and the marketing behind it. The company pushes the life insurance plan as an affordable option for people on a fixed budget. Unfortunately, while $9.95 is a relatively low price for life insurance, the death benefit amount is meager and, in most cases, will not provide enough coverage to cover the total cost of a funeral. We can honestly say you will find better life insurance by taking the time and working with an independent life insurance agent that can shop coverage between multiple companies. In addition to the lackluster coverage, the company’s customer complaint records are a factor that should be considered when choosing Colonial Penn or any life insurance provider. As mentioned, several complaints stem from beneficiaries having a bad experience with the death claims process. Conclusion – Is Colonial Penn Life Insurance Policy Worth It?Colonial Penn life insurance is worth it for those wanting convenient coverage for their final expenses. You can get a policy from Colonial Penn to cover your funeral costs or supplement an existing insurance policy. While the coverage amounts are low and the plans do not include many options for customizing your plan, you can obtain a policy quickly and easily. You can apply online and receive a quote in minutes. Colonial Penn guaranteed acceptance may also be a smart choice for those with pre-existing health conditions, but you are highly likely to find better alternatives offered by many other providers. Before pulling the trigger on a Colonial Penn life insurance policy, take a minute to use our online quote tool to compare rates and have us go to work for you so we can find you the absolute best policy and price based on your insurance needs. Is Colonial Penn legit?Colonial Penn has a Financial Strength Rating of A- (Excellent) from A.M. Best, which means it has plenty of resources on hand to pay claims. Consumers also tend to give positive feedback regarding Colonial Penn's quick and simple claims process.
What do you get for $9.95 a month from Colonial Penn?The Colonial Penn life insurance plan for $9.95 per month is a guaranteed acceptance whole life policy with a waiting period of two years. It offers permanent lifelong coverage with a premium that will never increase and builds cash value. There are no health questions or exams to determine your eligibility.
Can you cancel Colonial Penn life insurance?Contact Colonial Penn's customer care department by calling 800-523-9100 to cancel your policy. After enrolling with Colonial Penn, you have 30 days to terminate your agreement.
How much coverage does the 995 plan give?With this plan, you can receive a coverage maximum of $50,000, and it is available to anyone between the ages of 18 and 75.
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