Colonial Penn life insurance review 2020
Find a diverse product lineup, flexible policy options and competitive pricing
finder.com’s rating: 3.5 / 5.0
Get a quote if…
- You don’t want the hassle of a medical exam.
Pick something else if…
- You want a coverage amount over $50,000.
18 to 75
$10,000 to $50,000
Medical Exam Required
|Free quote||Online, Phone|
|Policy options||Renewable Term, Guaranteed Acceptance, Permanent Whole.|
|Term lengths||5 year banded term – up to age 90|
|Claim methods||Mail in a claim form|
|Ratings||A.M. Best: A-|
|Available states||Policies are available in all states except Maine (Whole, Term), Montana (Term), New York (Whole, Term) and Vermont (Whole, Term)|
|Customer support||Phone, Online|
|Riders||Guaranteed insurability, Accidental death, Accelerated death benefit|
Rhys Subitch is a writer and editor at Finder who tackles topics across the site. With half a decade of experience researching, editing and writing for a Fortune 500 company, university and several independent publications, Rhys brings readers the most up-to-date and curated info on all things finance.
Colonial Penn offers three basic options for life insurance, including term and whole life policies. While none of them require a medical exam, the coverage is less than you might find with other providers and you can’t add on riders to better fit your needs.
What types of life insurance coverage does Colonial Penn offer?
Colonial Penn offers both term and whole life insurance policies to help prepare you financially for the future. Of the two whole life insurance plans it offers, one is guaranteed acceptance, meaning you can’t be turned down because of your health. None of its policies require a medical exam, and you can get coverage up to $50,000 to help offset the costs of funeral expenses, credit card debt, medical bills and so on.
Here are the coverage details and price ranges for each of Colonial Penn’s three life insurance plans:
|Plan||Coverage||Medical exam||Age availability||Protection until||Rate increase||Monthly premiums||Disclaimers|
|Renewable Term Life Insurance||$10,000–$50,000||None||18–75||Age 90||Yes, based on fixed 5-year age bands||$2.54–$800.80||Guaranteed ability to exchange for permanent life insurance at age 90|
|Guaranteed Acceptance Whole Life Insurance||Up to $16,664||None||50-85 in most states||For life||No||$9.95–$79.60||You can’t be turned down because of your health, but the first two years of coverage are limited|
|Permanent Whole Life Insurance||$10,000–$50,000||None||40–75||For life||No||$14.36–$576.44||Cash value builds after the first year|
Does Colonial Life offer burial insurance?
Yes. Colonial Life’s guaranteed acceptance policy functions as burial insurance. Like most final expense policies, it’s marketed to seniors — in this case, those aged 50 to 85 — and capped at a small amount.
No medical exam is required, and if you die of natural causes within the first two years of taking out the policy, your beneficiaries will receive a lump sum equal to the premiums paid plus interest compounded annually. If you pass away after the two-year mark, the insurer will pay the full death benefit.
What life insurance riders does Colonial Penn offer?
While most insurers offer policy add-ons like child coverage or disability coverage, Colonial Penn only offers a few, and coverage may be limited by state, age and gender. Unfortunately you’ll have to call an agent to find out what coverage you can qualify for.
- Guaranteed insurability. This is built in to all policies and ensures you won’t lose or have reduced coverage due to age or illness as long as you pay your premiums.
- Accidental death. Pays out a higher benefit to your beneficiaries if you die in an accident.
- Accelerated death benefit. Get up to 50% of your life insurance benefit if you have a heart attack, stroke, cancer or a chronic illness.
How can I get a low rate?
Though there aren’t any full guides provided on the Colonial Penn website as to how you might get the lowest premiums, most insurers look for some common traits. Lifestyle choices and health history can usually swing your costs either way. Here are some assessment criteria underwriters generally look at:
- History of or current use of alcohol or tobacco.
- History of or current substance abuse.
- Family or personal history of certain diseases.
- Certain measures of current health, such as cholesterol.
- High-risk hobbies or jobs.
- Criminal convictions.
Pros and cons of Colonial Penn
- No medical exams. If you’re worried about not getting coverage because of a preexisting condition, you won’t have to do anything more than answer some simple health questions.
- Build cash value. Whole and term life plans gain cash value over time that you may be able to borrow against.
- Locked-in premium and benefit amount. Your premium will stay the same for the length of your coverage for guaranteed acceptance and whole life plans.
- Flexible payment options. All plans offer monthly, quarterly, semi-annual and annual payment options.
- 30-day money-back guarantee. If you decide that the life insurance policy you took out isn’t for you, you can cancel the policy before 30 days and get a full refund.
- Low coverage amounts. $50,000 is the highest coverage amount available under any of the plans. Compared to other companies that offer upwards of $5 million, this is quite low.
- Few riders available. Most insurers offer riders or policy add-ons to expand coverage to meet your specific needs, but Colonial Penn doesn’t offer or has limited coverage for families and disabilities.
- Not all plans are available in all states. The Permanent Whole Life Insurance plan is unavailable to residents of Maine, New York and Vermont; term life insurance is unavailable to residents of those same states and Montana.
- High number of complaints. Colonial Penn received a complaint ratio of 1.03 in 2018 for life insurance from NAIC, which is the national median of 1.00.
Compare alternatives to Colonial Penn
Colonial Penn reviews and complaints
Though its financial strength is rated high, it doesn’t have the best of customer reviews. As of this writing, the Better Business Bureau (BBB), which gave Colonial Penn an A+ rating, has more than 80 complaints closed over the past three years. Most complaints concerned problems with the life insurance policies as well as advertising and billing issues. Colonial Penn received a complaint ratio of 1.03 in 2018 for life insurance from NAIC, which is close to the national median of 1.00. Complaints centered around coverage availability and speed of claim payment.
Other reviews around the web note pushy salespeople encouraging customers to take out more insurance than they need or want, lost policies after years of paying into them, being turned down for the guaranteed acceptance policy and frequent advertising robo calls.
Colonial Penn’s parent company, CNO Financial Group and its subsidiaries, received a financial strength rating of A- (Excellent) from A.M. Best. This rating is reflective of Colonial Penn’s projected ability to pay out benefits.
How does Colonial Penn protect my data?
Colonial Penn claims it will only collect your personally identifiable information in order to personalize your visit to its website and to provide you with information you request. Colonial Penn will only share your data with third parties when it’s necessary to perform services on their behalf.
To keep your data safe, Colonial Penn uses security protocols including SSL, IPSEC and TripleDES. These methods, along with Colonial Penn’s secure server using 128-bit encryption, work to ensure your information is protected against loss or theft.
How do I sign up for a Colonial Penn policy?
- To get a quote, from Colonial Penn’s homepage, select your state from the drop-down menu and click Get Quote.
- On the following page, enter your name, birthdate and gender and then click Next.
- Next you’ll be prompted to provide your location and contact info. Enter your street address, email address and phone number and click Next.
- You’ll then be provided quotes for the policies available to you. From here you can click on Learn More to get further details on the policy, or you can continue with the application process by clicking Select.
- Answer questions about your health and designate your beneficiaries.
- Review your documents online, then e-sign to confirm. A licensed agent will contact you shortly to finalize the process.
- Once you’re officially approved, register your account online, where you’ll be able to pay your monthly premium, update your contact info and review your policy.
How do I file a life insurance claim with Colonial Penn?
- Go to the Colonial Penn website.
- Scroll down to the bottom of the homepage and click Claims, under the “Service” header.
- Click Download Forms along the top nav.
- Click Claim Form for Life Insurance Death Benefits and select the state of the policyholder.
- Download, print and fill out the form.
- Mail the form, certified death certificate and original insurance contract to:
- Colonial Penn Life Insurance Company
- Life Claims Department – 2250
- 399 Market Street
- Philadelphia, PA 19181-2250
- Wait for an agent from Colonial Penn to contact you regarding next steps.
About Colonial Penn
Colonial Penn was established in 1968 as a way to provide insurance to members of American Association of Retired Persons (AARP). After changing hands a few times it ended up as a subsidiary of CNO Financial Group in 1997. New York is the only US state not served by Colonial Penn, however it’s still covered under another subsidiary of CNO — Banker’s Conseco Life Insurance Company.
You’ll find three plans available from Colonial Penn, including guaranteed acceptance, term life and whole life options. Though none of the plans require a medical exam, the coverage amount may not be substantial on its own. Free quotes are available online to help you determine what you might qualify for.
It’s important to assess your family’s needs when you’re putting together a plan for life insurance. If Colonial Penn isn’t the right fit, compare life insurance providers.
Frequently asked questions about Colonial Penn
Life insurance ratings
★★★★★ — Excellent
★★★★★ — Good
★★★★★ — Average
★★★★★ — Subpar
★★★★★ — Poor
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