Colonial Penn Life Insurance Review [2024] (2024)

Whether on late-night cable or between online videos, many people have seen Colonial Penn’s commercials for life insurance that only costs $9.95. Life insurance is one of the best ways to take care of your loved ones after your death, so a $10 monthly plan sounds too good to be true.

Even though you might’ve seen the commercial, Colonial Penn is probably not the first name you think of for life insurance. However, it’s been selling coverage since 1939 and remains a semi-popular choice for no-medical exam life insurance.

Finding life insurance for under $10 a month is appealing, especially to seniors living on a budget. Unfortunately, Colonial Penn’s $9.95 plan is misleading. Although you can buy some coverage for $10, you’ll probably pay much more.

Colonial Penn also offers traditional insurance, though these products aren’t quite as popular as its $9.95 plan.

You can explore Colonial Penn’s insurance options below to see if it might have the right policy for you. However, you should always compare rates with other companies to ensure you get the best price and plan for your needs.

What is Colonial Penn’s $9.95 life insurance plan?

While Colonial Penn sells several types of insurance, it’s most famous for its $9.95 plan. According to the commercials, the $9.95 plan is one of the most affordable whole-life policies on the market. You’re mostly correct if you think it sounds too good to be true.

The $9.95 plan is Colonial Penn’s life insurance for seniors, as you only qualify for coverage between 50 and 85. It uses a unique sales technique you won’t find with most other companies. It sells the $9.95 plan in units. You can purchase up to $50,000 in coverage, but only if you buy multiple units.

Each unit costs $9.95, no matter what your situation is. Colonial Penn determines how much coverage each unit contains by collecting basic information about you, like your gender, location, and age. Once you know how much coverage each unit is worth, you can buy up to 15.

The amount of coverage that each unit contains depends on your unique characteristics. However, you can look at the average unit’s coverage for a 55-year-old below.

You can technically buy life insurance for $9.95 a month, but it will be for minimal coverage. You’ll need to pay for several units if you want more substantial coverage.

However, even if you buy the maximum number of units, the amount of coverage will never match traditional whole-life plans. The $9.95 plan is a guaranteed issue, which means you pay more for the benefit of skipping the medical exam most policies require.

The small death benefits make this plan Colonial Penn’s burial insurance rather than a traditional whole-life policy. It won’t help your loved ones pay bills, but it does help cover your end-of-life expenses.

Read more:

• Colonial Penn 995 Plan Review

Does Colonial Penn sell other types of life insurance?

Not everyone sees the appeal in buying life insurance by the unit. If that’s true for you, Colonial Penn has other traditional plans to choose from.

However, before you sign up for a Colonial Penn plan, you should know that this company has strict age requirements for its term and permanent plans. Additionally, Colonial Penn life insurance rates are usually more expensive than competitors.

Colonial Penn doesn’t offer a variety of plans, so you don’t have much to choose from. However, you can explore your options below.

Colonial Penn Term Life Insurance

Although Colonial Penn focuses mainly on permanent life insurance, term life policies generally sell better. That’s because term life plans are more affordable, have considerable death benefits, and are easy to understand. Term life is usually enough insurance for the average person.

Colonial Penn’s term life insurance plan is a little different than a typical policy. Rather than choosing a number of years you want to be covered, Colonial Penn term life policyholders renew each year. Your rates will increase in five-year increments.

This plan offers up to $50,000 in coverage and can only be purchased up to 75 years old, though you can continue to renew an existing plan until you turn 90. Make sure to check with an insurance representative because term life isn’t available in every state.

Colonial Penn Whole Life Insurance

Whole, or permanent, life insurance covers you for the remainder of your life, as long as you keep making payments. Whole life is more expensive than term, but you never have to worry about renewing your policy, and most plans accumulate cash value.

You’ll probably find cheaper rates elsewhere if you’re in good health and want a whole life insurance policy. However, Colonial Penn is a good choice for people with serious medical conditions because it skips the exam.

You still have to sit through a medical interview. Colonial Penn wants to understand your general sense of health, but it’s far less invasive than the average life insurance exam.

Colonial Penn sells whole life plans to people ages 40 to 75, and the maximum death benefit is $50,000. Although Colonial Penn denies some applicants due to health concerns, most people are approved.

Additional Add-ons for Colonial Penn Insurance

Colonial Penn is a recognizable name in life insurance, but it’s still a small company. While most providers offer a long list of add-ons to increase the value of your policy, smaller companies often struggle with add-ons. Colonial Penn is guilty of this. It only offers one add-on.

You can purchase the Living Insurance add-on for either whole or term insurance, but only if you’re under 65. This add-on allows you to collect part of your death benefit early if you become seriously ill. In addition, you can use the money to help cover expenses related to your treatment.

For heart attacks or other chronic illnesses defined by your policy, you can collect up to 50% of your benefit. For cancer, you can collect 25%.

Colonial Penn Life Insurance Reviews

Reviews for Colonial Penn are mixed. While some customers love finding insurance that doesn’t require a medical exam, others are less enthusiastic.

One of the most common complaints about Colonial Penn is that it refuses to pay beneficiaries after the policyholder dies. Many people are also disappointed that there is no online option to submit claims. Instead, you must submit documentation by mail and call the Colonial Penn life insurance phone number for help.

As for professional ratings, The National Association of Insurance Commissioners (NAIC) gives Colonial Penn a 2.12. The national average is 1.0, which means Colonial Penn gets more complaints than similar companies.

A.M. Best reports on the financial strength of insurance companies to give you a better idea of their ability to fulfil claims. The CNO Financial Group owns Colonial Penn and has an A- with A.M. Best.

Finally, the Better Business Bureau (BBB) rates Colonial Penn with an A+ for its ability to resolve customer issues. However, the BBB website has a long list of negative reviews.

Is Colonial Penn life insurance right for you?

From a $9.95 insurance plan to no medical exam whole life, Colonial Penn doesn’t sell the same life insurance as everyone else. It’s certainly not the best choice for everyone, but it gives people with serious medical conditions the opportunity to buy life insurance.

Buying Colonial Penn insurance is easy because the application process is simple, and there are no other medical exam policies. However, before signing with Colonial Penn, check other companies for the best fit.

Pros and Cons of Colonial Penn Life Insurance

Colonial Penn offers a few types of plans for people that need no-exam life insurance. The pros and cons of Colonial Penn insurance can help you decide if this company is for you. Considering Colonial Penn’s higher complaint ratio, you can probably get your coverage needs met better by a different company. However, the Colonial life insurance company has a solid financial rating with A.M. Best.

While Colonial Penn isn’t the biggest life insurance provider in the country, it’s a semi-popular choice for people looking for no-exam insurance.

However, the insurance company has restrictive limits and plan options. It might not be the best choice for you unless your circ*mstances call for a no-exam life insurance policy.

You should consider the pros and cons of Colonial Penn insurance before buying a policy, and compare quotes with other companies. Enter your ZIP code into our free tool to see what rates might look like for you.

What is Colonial Penn life insurance?

Colonial Penn has several life insurance options you can purchase. Most life insurance companies sell term and whole life, and Colonial Penn is no exception. They also sell policies that don’t require a medical exam.

One unique note about Colonial Penn is that they have strict age limits for their policies. If you’re looking for more inclusive options, it might be best to go elsewhere.

Colonial Penn Whole Life

As its name suggests, whole life insurance covers you for the rest of your life, as long as you keep up on your payments. It also builds cash value as you make payments, which you can borrow against.

Unlike most whole life insurance plans, Colonial Penn doesn’t require a medical exam. However, you will still need to answer questions about your health in an interview with your agent. You might not qualify for a whole life policy, but chances are you will.

Colonial Penn offers permanent life insurance for people between the ages of 40 and 75, for up to $50,000.

Colonial Penn Term Life

Term life is the most common type of life insurance people buy. In general, term is less expensive than whole life while offering similar coverage. The two most significant differences are that there is no cash value accumulation with term and that it doesn’t last your entire life.

Colonial Penn’s term life is renewable, which means you can renew your policy when the term ends. Your policy is guaranteed renewable until you reach 90 years old, without you having to worry about questions regarding your health.

If you’re interested in Colonial renewable term, you need to be between the ages of 18 and 40. People ages 18 to 75 can buy regular term. Like with whole life, the maximum amount of term coverage you can buy is $50,000.

Colonial Penn Guaranteed Acceptance

As long as you are between the ages of 50 and 85, you can qualify for Colonial Penn’s guaranteed acceptance coverage. There are no medical exams or interviews with this policy, meaning you’ll be eligible no matter what your health status is.

This policy has a two-year waiting period. If you die before the waiting period passes, your beneficiary won’t receive the full payout. However, your full death benefit will be paid after that period passes.

Add-Ons for Colonial Penn Insurance

Most life insurance companies offer add-ons that you can purchase to increase the value of your policy. Colonial Penn has one add-on available for purchase, which is much fewer than other companies.

The add-on is called Living Insurance and can be purchased for a whole or renewable term policy.

Living insurance allows you to collect a portion of your death benefit if you become seriously ill. You can claim up to 50% of your benefit for certain chronic illnesses and heart attacks. If you become ill with cancer, you’re eligible for 25%.

This add-on can help you pay for medical bills if you become ill, but only people under 65 are eligible to purchase it.

How much does Colonial Penn life insurance cost?

Despite limited options, Colonial Penn offers affordable prices. The cheapest option starts at $10 a month, but consider the following prices to get an idea of what you might pay.

The prices above are for a whole life insurance policy for a 45-year-old man and woman. There are cheaper options out there, but this can be a good option if you need no-exam life insurance.

Colonial Penn Life Insurance Reviews

Colonial Penn has an unfortunate number of customer complaints. The main complaints regard the payout process. Numerous customers complain that Colonial Penn refuses to make payments after the insured died.

The National Association of Insurance Commissioners (NAIC) compiles information about customer complaints. It does so for every insurance company and publishes the information as a ratio, taking company size into account.

The average complaint ratio with the NAIC is 1.0. Companies with anything over 1.0 are considered above average, and under are below average. Colonial Penn has a ratio of 2.12, meaning they receive more than double the complaints of the average insurance company.

Colonial Penn’s complaint ratio is rising, too. The 2.12 ratio is from 2020. In 2019, the company had a ratio of 1.16.

A.M. Best judges the financial security of a company. The financial strength of an insurer lets you know how likely it is that it can pay your claims. Colonial Penn is owned by the CNO Financial Group, which receives an A- (excellent).

Pros and Cons of Colonial Penn Insurance

So, what are the pros and cons of Colonial Penn insurance? Consider the following to make it easier to decide if Colonial Penn is right for you.

As you can see, there are some good reasons to consider Colonial Penn, especially if you need no-exam life insurance. However, you can probably find a different insurance provider to fit your needs better.

Is Colonial Penn right for you?

Colonial Penn life insurance might be the best choice for you if you need no-exam life insurance. Though coverage limits are low, some life insurance is better than none.

Now that you’ve seen the pros and cons of Colonial Penn insurance, you might have a better idea of whether this company is best for you. However, you should still compare companies to get the best rates. Enter your ZIP code into our free tool to see what quotes might look like for you.