Pros and Cons of Colonial Penn Life Insurance [2023]
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.
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Brandon Frady
Licensed Insurance Agent
Brandon Frady has been a licensed insurance agent and insurance office manager since 2018. He has experience in ventures from retail to finance, working positions from cashier to management, but it wasn’t until Brandon started working in the insurance industry that he truly felt at home in his career. In his day-to-day interactions, he aims to live out his business philosophy in how he treats hi...
Licensed Insurance Agent
UPDATED: Jul 7, 2023
It’s all about you. We want to help you make the right life insurance coverage choices.
Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance company and cannot guarantee quotes from any single company.
Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different life insurance companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.
UPDATED: Jul 7, 2023
It’s all about you. We want to help you make the right life insurance coverage choices.
Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance company and cannot guarantee quotes from any single company.
Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different life insurance companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- Colonial Penn offers no-exam life insurance for those who need no-exam policies
- People enjoy being able to buy whole, term, or guaranteed acceptance through Colonial Penn for fairly affordable prices
- The National Association of Insurance Commissioners reports a high rate of complaints against the company, the majority of which center around the claims process and how difficult it can be to resolve issues
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 circumstances 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.
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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.
Coverage amount Female monthly price Male monthly price
$10,000 $18.44 $22.74
$20,000 $33.13 $41.73
$30,000 $47.82 $60.72
$40,000 $62.51 $79.71
$50,000 $77.21 $98.70
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.
Pros Cons
No-exam insurance plans available for people who don't qualify for standard policies Maximum coverage amount is $50,000
30-day refund period where you can cancel for a full refund Strict age limits for plans
Quick and easy to get an online quote Not available throughout the entire states
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.
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Case Studies: Pros and Cons of Colonial Penn Life Insurance
Case Study 1: John’s No-Exam Life Insurance Experience
John, a 50-year-old individual, was looking for a life insurance policy that didn’t require a medical exam. He came across Colonial Penn and decided to explore their options.
John found the application process with Colonial Penn to be simple and convenient, as he didn’t have to undergo a medical examination or answer extensive health-related questions. He qualified for Colonial Penn’s guaranteed acceptance policy and was able to secure coverage without any hassle.
However, John later faced difficulties with the payout process after his insured passed away. He experienced delays and complications in receiving the full payout, which caused frustration and dissatisfaction.
Overall, while Colonial Penn offered the convenience of no-exam insurance, the issues with the payout process were a major drawback for John.
Case Study 2: Sarah’s Limited Coverage Needs
Sarah, a 35-year-old individual, needed a life insurance policy to protect her family financially. She considered Colonial Penn for its affordability and ease of application.
However, after evaluating her coverage needs, Sarah realized that Colonial Penn’s policies had restrictive limits and plan options. The maximum coverage amount of $50,000 was insufficient to meet her long-term financial goals and adequately provide for her family.
Sarah decided to explore other insurance providers that offered more comprehensive coverage options. While Colonial Penn may be suitable for individuals with specific circumstances requiring no-exam policies, it fell short for Sarah’s needs.
Case Study 3: Mark’s Affordable Option
Mark, a 45-year-old individual, was seeking affordable no-exam life insurance. He found Colonial Penn’s prices to be reasonable, with the cheapest option starting at $10 a month. Mark decided to purchase a whole life insurance policy from Colonial Penn due to its affordability and convenience.
Despite the limited coverage amount, he considered it a good option to have some life insurance in place without the hassle of a medical exam. Mark was satisfied with his decision, considering his budget and specific requirements.
Frequently Asked Questions
What are the key advantages of Colonial Penn Life Insurance?
Some of the key advantages of Colonial Penn Life Insurance include:
- Guaranteed Acceptance: Colonial Penn offers guaranteed acceptance for their life insurance policies, which means that applicants are not required to undergo a medical exam or answer health questions.
- Quick and Simple Application Process: The application process for Colonial Penn Life Insurance is straightforward and can be completed online or over the phone, making it convenient for individuals seeking coverage.
- Permanent Coverage: Colonial Penn offers whole life insurance policies, which provide coverage for the entire lifetime of the insured as long as premiums are paid.
- Affordable Premiums: Colonial Penn’s life insurance policies are often competitively priced, particularly for individuals who may have difficulty obtaining coverage from other providers due to health issues or age.
What are the potential drawbacks or limitations of Colonial Penn Life Insurance?
While Colonial Penn Life Insurance offers certain advantages, it’s essential to consider the potential drawbacks or limitations as well:
- Limited Coverage Amounts: The coverage amounts available through Colonial Penn are typically lower compared to other life insurance providers. This may not be sufficient for individuals with significant financial obligations or those seeking higher coverage.
- Waiting Period for Full Benefits: In certain cases, there may be a waiting period before the full death benefit becomes payable. During this waiting period, the benefit paid out may be limited to a return of premiums paid plus interest.
- No Cash Value Accumulation: Colonial Penn’s life insurance policies do not accumulate cash value over time. This means that the policies do not provide any savings or investment component like some other types of life insurance.
- Limited Policy Options: Colonial Penn primarily offers simplified issue whole life insurance policies, which may not cater to individuals seeking more specialized coverage options or riders.
Is Colonial Penn Life Insurance suitable for seniors?
Colonial Penn Life Insurance can be a suitable option for seniors due to its guaranteed acceptance policy and simplified application process. Seniors who may have difficulty qualifying for traditional life insurance policies due to health issues or age-related factors may find Colonial Penn’s offerings appealing. However, it’s still advisable for seniors to compare quotes and consider other insurance providers to ensure they find the most suitable coverage for their needs.
Does Colonial Penn Life Insurance offer any additional benefits or riders?
Colonial Penn’s life insurance policies typically do not offer a wide range of additional benefits or riders. While they focus on providing basic coverage, such as the death benefit, they may not provide options for customization or additional policy features commonly found with other insurance companies. It’s recommended to review the policy terms and conditions or contact Colonial Penn directly for more information on available riders or additional benefits.
How can I apply for Colonial Penn Life Insurance?
Applying for Colonial Penn Life Insurance is a straightforward process. You can either visit their website or call their customer service to request an application. The application typically requires providing basic personal information, such as age, gender, and contact details. Since Colonial Penn offers guaranteed acceptance, you will not need to undergo a medical exam or answer extensive health-related questions. Once you submit the application, Colonial Penn will review it and provide you with the necessary details regarding your coverage and premium amount.
Your life insurance quotes are always free.
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Brandon Frady
Licensed Insurance Agent
Brandon Frady has been a licensed insurance agent and insurance office manager since 2018. He has experience in ventures from retail to finance, working positions from cashier to management, but it wasn’t until Brandon started working in the insurance industry that he truly felt at home in his career. In his day-to-day interactions, he aims to live out his business philosophy in how he treats hi...
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.
