Colonial Penn is a life insurance company based in Philadelphia, Pennsylvania. They were founded in 1968 and have a variety of life insurance options available. They are known for catering to customers over the age of 50. However, they do offer life insurance coverage for younger adults as well.
Colonial Penn Life Insurance has been a subsidiary of CNO Financial Group since 1997. They currently offer coverage in all 50 states, although their coverage in New York is offered through a separate subsidiary.
With so many different life insurance companies on the market, it can be difficult to choose the one that is best for your needs. In this article, we’ll take a look at Colonial Penn Life Insurance and the policies they offer to see if they are the right fit for your needs.
Types of Life Insurance Offered
Colonial Penn has a few different types of life insurance policies to choose from. Here are the options that they provide.
Guaranteed Acceptance Whole Life
This is Colonial Penn’s most popular insurance policy on the market. It has attracted a lot of attention because of how affordable it is – their policies start at $9.95 per month.
Guaranteed issue life insurance provides coverage from the issue date until the end of your life. It differs from a traditional whole life insurance policy in that you do not have to take a medical exam or answer any health questions in order to qualify.
However, the benefits are not as extensive as they would be for a traditional whole life insurance policy. The exact benefit amount is going to depend on your individual situation. These policies are usually used just to cover funeral expenses rather than pay off debt or support family members.
Colonial Penn’s guaranteed acceptance life insurance policy is available for people between the ages of 50 and 85. They do have a two-year limited benefit period for this policy. This means that if the insured person passes away within the first two years of purchasing the policy, their beneficiaries won’t receive the full insurance amount.
These policies do come with a cash value component as well. You can decide how often you want to make your premium payments – they offer monthly, quarterly, semi-annual, and annual payment plans.
Permanent Whole Life Insurance
Colonial Penn also offers permanent whole life insurance for clients between the ages of 40 and 75. This is a great option for anyone who wants more extensive coverage for the rest of their life.
While you won’t have to take a medical exam in order to qualify for this coverage, you will have to answer some health questions as part of your application. This coverage is not guaranteed issue, which means that Colonial Penn could theoretically deny you coverage if your health is poor enough.
This plan offers a maximum benefit of $50,000. Your rates will be determined when you are initially approved for the plan and they will stay the same throughout the life of the policy. After the first year, this policy does come with a cash value component that you can borrow against if you need to.
Term Life
While Colonial Penn does not currently offer term life insurance, they have offered it in the past for customers between the ages of 18 and 75. If this is something you are interested in, you may want to talk to their sales team to see what options they have. Their term life plans were the only ones to accommodate younger customers. Term life plans are typically more affordable than whole life plans and last for a specific number of years rather than your entire life.
As with Colonial Penn’s whole life policies, their term life options provided benefits of up to $50,000 each. They did not require medical exams but did require you to answer health questions as part of the application process. The price for this policy can increase over time relative to the customer’s age.
Riders Available
Colonial Penn has a few riders available for their life insurance policies. Riders can help you customize your policy to provide coverage that better suits your needs. If you’re looking for a specific rider that isn’t listed here, it may be worth talking to Colonial Penn’s sales team to see if they can accommodate you.
Living Insurance Accelerated Death Benefit
Colonial Penn offers their Living Insurance rider for their whole life insurance policies. The Living Insurance rider provides an early 50 percent payout if you are diagnosed with a certain medical condition before you die.
When you sign up for the policy, you will select the medical condition that you would like coverage for. They currently offer the Living Insurance rider for most cancers, heart attack, stroke, and many debilitating chronic conditions. The Living Insurance rider will also kick in if you are diagnosed as terminally ill and have a life expectancy of less than one year.
This rider is not available for guaranteed acceptance policies. The rider also offers limited benefits for applicants over the age of 65 – for example, you won’t be able to use the chronic illness aspect of the rider past this age.
Accidental Death Benefit
This rider is available for customers between the ages of 40 and 65 and is available for their whole life insurance policies. This benefit is available in amounts ranging from $10,000 to $50,000. This rider will provide an additional payout if you die as a result of an accidental bodily injury. However, there are certain exclusions to this coverage – you will not receive a payout if your death is caused by activities like rock climbing, racecar driving, bungee jumping, or skydiving.
Unique Features of Colonial Penn Life Insurance
Colonial Penn is a very unique life insurance company in that they have such a heavy focus on guaranteed acceptance life insurance. Their guaranteed acceptance policies start at less than $10 per month, and although they don’t provide extensive coverage, they can still be a great option if your primary concern is covering funeral expenses.
Colonial Penn is also an excellent option for customers who struggle with health issues. Many other life insurance companies require their customers to take a health exam before they can get approved for coverage. Customers in poor health are often charged very high rates or even denied coverage. Colonial Penn’s guaranteed acceptance program makes it easier for these people to obtain the life insurance coverage they need. Additionally, their traditional whole life insurance policies only require customers to complete a questionnaire rather than an in-person health examination.
The downside of Colonial Penn Life Insurance, when compared to its competitors, is that its coverage amounts are relatively small. The highest policy amount that they offer right now is $50,000. While this is typically enough to help cover funeral expenses, this isn’t going to be enough to replace your income and support your living family members after your death.
Financial Ratings
When looking at any life insurance company, you’ll want to make sure that they are financially stable enough to pay their claims, even during tough economic times. One way to check this is by looking at the company’s financial ratings. Organizations like A.M Best evaluate and rate insurance companies based on their current financial status and stability.
Colonial Penn currently has a financial strength rating of A- from A.M. Best. While this isn’t the highest rating available, it does indicate that Colonial Penn has plenty of financial resources available and can pay their insurance claims.
Reviews of Colonial Penn Life Insurance
Looking at reviews is another good way to determine if an insurance company is going to be a good fit for you. While everyone’s experience is different, reviews can give you a good idea of what to expect from the insurance company moving forward.
According to the National Association of Insurance Commissioners, Colonial Penn receives more complaints than average for a company of its size. However, they do have an A+ rating from the Better Business Bureau and also recently received a BBB accreditation.
Reviews of Colonial Penn Life Insurance are generally mixed. Many customers have noted that it is easy to purchase a policy and file a claim. However, others have noted that their sales tactics can be confusing and overwhelming, and their team doesn’t always help their customers understand the life insurance products they are buying beforehand.
Colonial Penn Application Process
Applying for a life insurance policy from Colonial Penn is a fairly straightforward process. Their website is fairly easy to navigate and provides helpful information about the different types of policies they offer. If you’re interested, you can easily get a quote through their website. You will need to answer some basic demographic questions as well as questions about the type of coverage you need.
If you are happy with the quote they provide, there are two ways to move forward with the application process. You can opt to complete the application online or you can print it out and mail it in. You will need to provide personal information and billing information, and you will also be asked to name your beneficiaries. For some policies, you will also need to fill out a medical questionnaire.
Once your policy is in place, you can manage it through the Colonial Penn website. It is fairly easy to make payments or file claims online, but they also have a customer service phone number and web chat feature.
Is Colonial Penn Life Insurance Legit?
Colonial Penn Life Insurance is a legitimate life insurance company. They are very financially stable and have a long history of paying their claims. It’s also fairly easy to purchase a policy and file claims, and they generally pay their claims quickly.
This life insurance company is best for people who want affordable premiums and basic coverage. If your main concern is getting life insurance without having to take a medical exam, Colonial Penn could be a good option for you. Their insurance policies provide enough money to cover your funeral costs with no hassle. They do also offer a small cash value component for those who prefer to have that.
However, if you are looking for more extensive coverage that you could use to pay off a mortgage or support your family, Colonial Penn’s products likely aren’t going to be enough. Their low policy amounts could be limiting for some customers. Ultimately, the best option is usually to get quotes from multiple insurers to see which ones are going to be the right fit for you.
