If you haven’t seen that Colonial Penn life insurance commercial, you’re not watching enough TV. But is there more to this Company’s products than its catchy TV commercials?
Check out our summary of the pros and cons of Colonial Penn insurance below to find out.
(And if you’re wondering, “is Colonial Penn good life insurance?”, read through our Colonial Penn life insurance review, which includes customer reviews, rates, and an application walk-through)
Who Is Colonial Penn?
Headquartered in Pennsylvania, Colonial Penn Life Insurance Company focuses on selling final expense insurance policies to seniors.
It pitches itself as a provider of affordable life insurance coverage, primarily through its $9.95 per month guaranteed acceptance plans.
Colonial Penn’s primary offering is life insurance that combines simplified underwriting with low death benefits.
Colonial Penn is also trying to give back. The Company has partnered with the American Heart Association (AHA) since 2020 to support its Healthy for Good campaign. This Colonial Penn program helps people to change their health and lifestyle by gradually changing their diet and incorporating more exercise into their days.
CNO Financial Life Insurance Companies
Colonial Penn Life Insurance Company is owned by CNO Financial Group, a financial services company headquartered in Carmel, Indiana.
Through its subsidiary insurance companies, CNO provides 3.2+ million policies to retired individuals and working-class Americans.
The CNO family of brands also includes the following companies: Bankers Life, Washington National, PMA USA, DirectPath, and MyHealthPolicy.
Whole Life Insurance Product Options
Colonial Penn offers two types of whole life insurance policies:
- Permanent whole life insurance
- Guaranteed acceptance whole life insurance
However, these policies have a low maximum death benefit, so they will appeal only to those looking for coverage for their final expenses (and not income replacement).
Note that Colonial Penn does not sell term life insurance policies. This is highly preferable to Globe Life, which sells term life coverage marketed as burial insurance coverage. We believe this is highly misleading.
None of Colonial Penn’s life insurance policies requires a medical exam. And if you purchase their guaranteed acceptance policies, you don’t even have to answer health questions!
Colonial Penn Life Insurance Pros
First, consider some positives of buying a life insurance plan from Colonial Penn.
Colonial Penn eligibility for guaranteed acceptance life insurance policies covers adults 50-85. The price you pay, however, does not depend on age or medical history.
No Medical Exams
Both of the Company’s whole life insurance products have no medical exam required. In addition to this, Colonial Penn’s flagship $9.95 per month plan does not even have health questions!
Colonial Penn application is 1-2 pages and can be completed entirely online.
Every Colonial Penn life insurance plan builds cash value (that is, it puts a portion of your premium payments into a savings account for you).
Ability To Pay Claims
Colonial Penn has an A- rating from A.M. Best, which means it is in great financial health and will easily pay claims on its current life insurance policies in force.
Colonial Penn Life Insurance Cons
Now, let’s look at the downsides — how reliable is Colonial Penn life insurance?
Better Business Bureau’s Colonial Penn reviews and complaints show that a large fraction of negative experiences had to do with problems filing a claim or delayed payouts. When your loved one dies, this is the last thing you want to deal with.
Pushy Sales Tactics
Many complaints about Colonial Penn revolve around the company’s sales practices. The Company has a long history of being pushy with their sales tactics. Colonial Penn has improved its sales practices, but many customers still feel the agents are overly aggressive.
Lack of Product Diversity
Colonial Penn offers essentially one type of life insurance coverage: burial insurance (also known as funeral insurance or final expense insurance). The Company does not sell term life insurance coverage, and it does not sell any policies (permanent or term) that offer immediate coverage.
High Cost Per Coverage
As we compared prices, we found that Colonial Penn customers typically pay higher premiums for the same amount of coverage.
Colonial Penn Life Insurance Ratings
Colonial Penn’s rating from the Better Business Bureau is A+; however, in our experience, these ratings are not very trustworthy.
Here’s the truth about Colonial Penn life insurance.
Colonial Penn Customer Complaints
Colonial Penn has had 183 total complaints in the last three years. Of those, 124 complaints were closed in the last 12 months.
The majority of these complaints have to do with a “problem with a product or service.” As we read through these reviews on Colonial Penn life insurance, we found that they had to do with:
- Difficulties filing a life insurance claim
- Mistakenly rejected claims
- Delayed payouts
Conclusion: Should You Buy Life Insurance From Colonial Penn?
Colonial Penn is a well-known life insurer that serves a unique need that others in the life insurance industry do not fulfill. So, is Colonial Penn a good insurance company?
We do not recommend buying a whole life insurance policy from Colonial Penn. While the $9.95 per month price appears attractive, the truth is that you will receive very little coverage for that price (~$500).
The cost per dollar of coverage is too high to justify purchasing Colonial Penn life insurance policies.
Unless you are looking for coverage to fund a direct cremation, which costs only ~$1,000, you will be much better off purchasing a burial insurance policy from a company like AARP or Mutual of Omaha.
Check out our detailed piece on Colonial Penn’s life insurance coverage and rate chart.
We hope this piece on the pros and cons of Colonial Penn policies was helpful to you! If you have any questions, don’t hesitate to comment or email us, and we’ll get back to you shortly.
The GetSure Team