2.9 / 5

Colonial Penn life insurance review

No term life policies, very high pricing for very low coverage amounts, and one of the highest complaint scores we’ve seen. Why go with Colonial Penn? There’s little reason unless you need guaranteed acceptance and don’t mind paying a lot for a little.

Tim Torres

By

Tim Torres

Tim Torres

Reviews Editor

Tim Torres is a reviews editor at Policygenius, where he specializes in life insurance, homeowners insurance, auto insurance, and more. His work has also appeared in PC Mag, Tom's Guide, Tech Times, and elsewhere.

Published|5 min read

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Colonial Penn

OVERALL

2.9

2.9

THE GOOD

    check mark

    No-med exam options

    check mark

    Easy to apply

THE BAD

    X mark

    Only two policies available

    X mark

    High premiums

    X mark

    Low coverage amounts

    X mark

    Many customer complaints

THE BOTTOM LINE

Colonial Penn has little to offer compared to other carriers. There are only two whole life policies available, neither of which require a medical exam. However, both have very high pricing for very low coverage amounts. There’s no term life policy available either. Unless you need a guaranteed acceptance policy and don’t mind paying a lot for a little, there’s little reason to go with Colonial Penn as your carrier-of-choice.

Policy details

Availability of such options as term length and no-med-exam availability.

4.0

Price

Average monthly premium cost for a predetermined applicant profile and common health conditions.

1.0

Financial confidence

Consumer confidence based on scores from major financial rating institutions.

7.5

Third-party ratings

Satisfaction from consumer sentiment institutions and complaints to state insurance boards.

1.5

Customer experience

Ease of application, convenience, online tools, and availability.

7.0

All set to shop?

The details

The good

No-med exam options. Colonial Penn’s policies are meant to help families with funeral costs and final expenses, so there are no medical exam requirements. However, you could still be declined on the whole life policy application depending on questions about your health history.

Easy to apply. Colonial Penn makes it easy to apply: you can do so online while receiving a quote or over the phone.

The bad

Only two policies available. There aren’t many options with Colonial Penn. You have a choice between a whole life policy or a guaranteed acceptance whole life policy. There was a term life product offered but that is currently no longer available. 

High premiums. Colonial Penn’s prices are quite high for the amount of coverage you get. You can get a much better deal — lower premiums, higher coverage — elsewhere. 

Low coverage amounts. Both of Colonial Penn’s policies max out at $50,000. That’s not a whole lot in most cases, so if you want to cover for a mortgage or a similar expense you’re going to need to continue shopping. 

Many customer complaints. Colonial Penn has one of the lowest Consumer Affairs scores, and one of the highest NAIC complaint index scores, we’ve seen. Of course, it’s up to you if you want to deal with any future headaches.

The breakdown

Policy details

Availability of such options as term length and no-med-exam availability.

4.0

There are only two life insurance products from Colonial Penn at this time: a guaranteed acceptance policy and a whole life policy. This review and its scoring focuses on the Permanent Whole Life policy. 

Colonial Penn also offers supplemental health insurance that could complement your life insurance policy.

There are currently no term life policies available from Colonial Penn.

Permanent life insurance

Permanent whole life 

This is a standard whole life product with no medical exam requirement, but you still have to answer medical-related questions. It builds cash value after the first year of coverage, which you can use to borrow against to pay towards your premium or other expenses. Premiums are locked-in, or level, so they never increase. 

Policy featurePermanent whole life
Eligible ages40 to 75
Policy lengthUp to age 121
Coverage minimum$10,000
Coverage maximum$50,000

$50,000 is a really tiny amount of coverage for most people. You can get much larger amounts of whole life and term life protection from other carriers. 

Only consider Colonial Penn if you have a preexisting condition and don’t mind paying higher premiums for a lower coverage amount. But that makes no sense! So we recommend you look at other carrier options instead. 

Find out more about whole life insurance and how it works.

Guaranteed acceptance

A policy with no medical exam requirement for people ages 50 to 85. There are no health questions to answer, either. There is also a two-year limited benefit period, which means if you die during this time (from non-accidental causes), the beneficiary will receive paid premiums back plus 7% interest compounded annually. After those first two years, the full death benefit will be paid for death from any cause.

Premiums are level, or locked-in, and there is a cash component that grows over time.

Price

Average monthly premium cost for a predetermined applicant profile and common health conditions.

1.0

We usually base reviews on term life policies and compare their pricing to the industry average costs. Colonial Penn doesn’t currently sell term policies. But we’ve provided what you can expect to pay for their Permanent Whole Life product based on their own online quote tool.

AgePermanent Whole Life
40s$98.70
50s$180.33
60s$317.24
70s$576.44

Okay, well, that’s still quite steep for a whole life policy. You can see how much you should pay for whole life insurance here. Colonial Penn’s prices are well above the usual monthly rate.

We also typically don’t recommend whole life policies in general because they are so expensive. In Colonial Penn’s case, it’s very expensive to pay so much for such a small amount of coverage. In other words, a policy with Colonial Penn will not be a great value for most people. 

Read more about the difference between term and whole life insurance.

Financial confidence

Consumer confidence based on scores from major financial rating institutions.

7.5

Founded in Pennsylvania in 1968, Colonial Penn has fairly high financial stability, as determined by the leading credit ratings agencies and financial analysis firms.

  • A.M. Best: A-

  • Moody’s: A3

  • Standard & Poor’s: A-

A.M. Best, a credit rating agency that focuses on the insurance industry, gives Colonial Penn an “excellent” score of A-. 

Moody’s gives Colonial Penn an A3, meaning there is some financial backing and some cash reserves with a low risk of default. This is the seventh-highest rating a company can receive.

Standard & Poor’s rates Colonial Penn at an A-. That means Colonial Penn is a strong investment and has the ability to pay out claims.

Third-party ratings

Satisfaction from consumer sentiment institutions and complaints to state insurance boards.

1.5

The word out there isn’t that great for Colonial Penn. It has both a low score on Consumer Affairs, which lets regular verified customers post reviews, and one of the higher complaint amounts gathered by state insurance departments. 

  • Consumers Advocate: n/a

  • Consumer Affairs: 1.5 / 5

  • NAIC complaint index: 8.87

Consumers Advocate has no review page for Colonial Penn.

Consumer Affairs, a site that lets verified users review companies, gives Colonial Penn a 1.5 out of 5. Common complaints include difficulty filing for claims and reimbursements, a lack of transparency, and overall difficulty dealing with customer service.

The National Association of Insurance Commissioners (NAIC) tracks complaints sent to state insurance departments. Its complaint index measures how many people have complained, with a score of 0 meaning there weren’t enough to count, and a score of 1 representing the baseline average. 

Colonial Penn has a score of 8.87. That means the NAIC has received nearly nine times more complaints than average. That’s a lot. In fact, it’s one of the highest complaint index scores we’ve seen. If you’re thinking of doing business with Colonial Penn, keep your patience caps handy. 

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Customer experience

Ease of application, convenience, online tools, and availability.

7.0

You can apply for Colonial Penn policies online or over the phone. Their website provides a few key details about their policies, as well as FAQs, email and phone contacts, and a helpful live chat option (which is still pretty rare to see in this space).

Application process

You can apply for Colonial Penn's policies online or over the phone. 

Turnaround time

You can expect to wait anywhere from one to six weeks for permanent life insurance policies. If you don’t need to take a medical exam, your wait time should be shorter.  

Policy delivery

You’ll have your policy delivered electronically or by mail.

More information

State availability

Colonial Penn products are available nationwide but exact policy features and details vary by state.

Change method

You can make changes to your name and address online, but to change your beneficiary you’ll have to download, fill out, and return a form by mail.

Payment methods

Colonial Penn offers several ways to pay, including:

  • Direct billing. You’ll receive a statement for payment by check or money order.
  • Credit card. Your card will be charged directly. To request recurring payments you need to call Colonial Penn to set that up.
  • EFT. Electronic funds transfer, which automatically deducts payments from your checking or savings account

You can also pay over the phone.

Digital tools

There’s an online quote tool and an online live chat option available.

Claims documentation

To submit a claim, the beneficiary needs to mail the following to Colonial Penn:

  • A claimant's statement
  • A certified death certificate
  • The original insurance contract

Frequently asked questions

Who owns Colonial Penn Life Insurance?

CNO Financial Group, a financial services holding company based in Indiana. Colonial Penn itself was founded by a co-founder of AARP who wanted to help families with final expenses. The name comes from the state of Pennsylvania, one of America’s original colonies and where the carrier is based.

Does Colonial Penn offer online quotes?

Yes, you can get online quotes for both of Colonial Penn’s policies on their website.

Does Colonial Penn offer term life insurance?

Colonial Penn used to offer Renewable Term Life insurance to people under age 40, with no medical exam requirement, and up to $50,000 in coverage. This product is no longer available. We will update this review if this policy, or another like it, returns.

Do I need to take a medical exam with Colonial Penn?

No, but you will need to answer questions about your medical and prescription histories.

Author

Reviews Editor

Tim Torres

Reviews Editor

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Tim Torres is a reviews editor at Policygenius, where he specializes in life insurance, homeowners insurance, auto insurance, and more. His work has also appeared in PC Mag, Tom's Guide, Tech Times, and elsewhere.

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