Colonial Penn is a legitimate company with solid financial ratings, but their guaranteed acceptance insurance is significantly more expensive than competitors. Most people in average health can find policies costing 40-50% less with better coverage and no waiting period. Colonial Penn should only be considered if you’ve been declined by multiple other insurers or have serious health conditions.
You’ve probably seen Jonathan Lawson (or before him, Alex Trebek) on TV talking about Colonial Penn’s guaranteed acceptance life insurance. The message sounds appealing: $9.95 per unit, no medical exam, guaranteed approval. But here’s the question we hear all the time: is Colonial Penn actually a good deal?
After 30 years helping people navigate life insurance options, we’ve learned that guaranteed acceptance policies like Colonial Penn’s have a specific purpose, but they’re not right for most people. Let’s break down what Colonial Penn actually offers, what it costs, and when you might have better options.
Colonial Penn Whole Life Insurance Policies
Colonial Penn specializes in one thing: guaranteed acceptance life insurance for seniors aged 50 to 85. That’s it. Unlike other national carriers that offer multiple product lines, Colonial Penn has put all their focus on this single type of policy.
Affordable Senior Life Insurance—Peace of Mind for You & Your Loved Ones
No Medical Exam. Guaranteed Coverage. Easy Approval.
Protect your family from unexpected expenses with a simple, affordable final expense plan. Get the coverage you need to ensure funeral costs don’t burden your loved ones.
🔹 Guaranteed Approval (Ages 50-85)
🔹 Fixed, Affordable Monthly Rates
🔹 Covers Funeral, Medical, & Other Final Expenses
You won’t find a Colonial Penn rate chart anywhere on their website or marketing materials. There’s a reason for that. Their pricing structure is unusual, and they prefer you spend time on the phone with a salesperson to get a quote.
Why Doesn’t Colonial Penn Have a Rate Chart?
If you’re searching for a Colonial Penn life insurance rate chart, you won’t find one published anywhere. Colonial Penn intentionally doesn’t provide traditional rate charts like other insurance companies.
Here’s why: Colonial Penn uses an unusual unit-based pricing system where the amount of insurance you get per $9.95 unit varies by your age and gender. A traditional rate chart would need separate tables for every age and gender combination, making it confusing and nearly impossible to compare.
Most insurance companies show you exactly what $10,000, $25,000, or $50,000 of coverage costs at your age. Colonial Penn makes you calculate your coverage amount by multiplying units times your age-specific unit value. This pricing opacity makes comparison shopping difficult, which is why they want you to call for a quote.
What is Guaranteed Acceptance Life Insurance?
Guaranteed acceptance insurance (also called guaranteed issue) is whole life coverage that asks no health questions and requires no medical exam. It’s traditionally marketed to seniors because it accepts everyone, regardless of health status.
The insurance industry now commonly calls this Final Expense or Burial Insurance. Colonial Penn’s version covers anyone between ages 50 and 85. You can’t be turned down even if you’re in poor health.
Here’s what you need to understand: since Colonial Penn’s guaranteed acceptance insurance requires little to no underwriting, it’s priced significantly higher than traditional life insurance. It should only be considered when you can’t qualify for a regular policy.
We’ve seen too many people buy this coverage right after watching a TV commercial, letting their emotions drive the decision. The ads are specifically designed to play on concerns about leaving family members with funeral expenses.
The Two-Year Waiting Period
This is critical to understand. If you die from natural causes in the first two years, Colonial Penn doesn’t pay the full death benefit. Instead, they return all premiums paid plus 7% compounded annually.
Other companies offering guaranteed acceptance (like AIG, Gerber, or Mutual of Omaha) typically pay back premiums plus 10% interest during the waiting period. Colonial Penn’s 7% is lower.
If you die from an accident in the first two years, Colonial Penn pays the full face amount. The accident must happen while the policy is active, and death must occur within 90 days of the accident.
Colonial Penn’s Unusual Pricing Method
Here’s where Colonial Penn gets confusing. They price coverage based on “units” at $9.95 each. Sounds simple, right? It’s not.
The amount of insurance in each unit varies based on your age and gender. A 60-year-old woman gets more coverage per unit than a 60-year-old man. The older you are, the less coverage each $9.95 unit provides.
Let’s look at real examples:
Mrs. Jones, age 60, average health:
She’s offered coverage of $1,519 per unit at $9.95. She buys the maximum 15 units. Her death benefit (after the two-year waiting period) would be $22,725, costing $149.25 monthly.
Mr. Jones, age 60, multiple health issues:
He’s had several heart attacks and is a type 1 diabetic. He’d normally be declined for life insurance. Colonial Penn accepts him at $9.95 per unit, but each unit only equals $1,167. His 15 units total just $17,505 in coverage.
Both pay the same $149.25 monthly, but get vastly different coverage amounts. This unit pricing system makes it nearly impossible to comparison shop without calling multiple companies.
What’s Included with Colonial Penn?
Despite the high price and waiting period, Colonial Penn’s guaranteed acceptance policy does include some standard whole life benefits:
Lifetime protection: Your policy can’t be canceled for any reason except non-payment. Even if you develop a terminal illness or move into a nursing home, Colonial Penn can’t drop your coverage.
Level premiums: Once issued, your premiums stay the same for life. Colonial Penn can’t increase your rates, even if your health deteriorates.
Cash value: Like traditional whole life, your policy builds cash value over time. You can access this money through policy loans or withdrawals. The current loan rate is 8%, which is quite high compared to other companies.
Accidental death benefit: You can add up to $10,000 in accidental death coverage for an extra $2.00 monthly.
Colonial Penn Rates vs. Competition
This is where things get concerning. Guaranteed acceptance policies should only be purchased as a last resort, when you have severe health issues preventing you from qualifying for traditional coverage.
Let’s use Mrs. Jones again as an example. She’s 60 years old in average health, buying a $9,336 policy from Colonial Penn for $79.60 monthly.
If she compared Colonial Penn to AIG’s guaranteed acceptance:
| Colonial Penn Life | AIG Life |
|---|---|
| $79.60 | $50.49 |
That’s a 58% price difference for similar coverage.
But here’s the bigger issue: Mrs. Jones is in average health. She’d likely qualify for a life insurance with no waiting period and much lower rates.
Colonial Penn vs. Mutual of Omaha (level benefit):
| Colonial Penn | Mutual of Omaha |
|---|---|
| $79.60 | $30.90 |
Mrs. Jones could pay less than half the Colonial Penn rate and get immediate full coverage with no waiting period. She’d just need to answer a few health questions and possibly take a brief phone interview.
This is what we see repeatedly. People assume they need guaranteed acceptance when they’d actually qualify for traditional coverage at much better rates.
Who Should Actually Consider Colonial Penn?
Colonial Penn (or any guaranteed acceptance policy) makes sense in very specific situations:
You’ve been declined by multiple traditional insurers due to serious health conditions. You need a small amount of coverage ($5,000-$25,000) for final expenses. You’re over age 80 with limited options. You have multiple severe conditions like advanced cancer, recent heart attack, or end-stage renal disease.
If you’re in reasonably average health, even with some manageable conditions like controlled diabetes or high blood pressure, you’ll almost certainly qualify for better options. Consider exploring no medical exam life insurance for seniors that offers more competitive rates.
Colonial Penn’s Financial Strength
Let’s be fair, Colonial Penn is a legitimate company with decent financial ratings:
| Rating Service | Rating |
|---|---|
| A.M. Best | A- |
| Fitch | BBB+ |
| Standard & Poor’s | BBB+ |
These ratings indicate Colonial Penn can pay claims. That’s not the issue. The issue is price and value.
Where is Colonial Penn Located?
To be clear, we’re not Colonial Penn. This is an independent review. If you need help with an existing Colonial Penn policy, contact them at:
Colonial Penn Life Insurance Company
399 Market Street, Philadelphia, PA 19181
877-877-0490
www.colonialpenn.com
What Customers Say About Colonial Penn
No insurance company is perfect. We checked the Better Business Bureau for Colonial Penn reviews because the BBB includes company responses to complaints, giving you both sides.
Colonial Penn has 82 complaints listed on their BBB page, mostly about product or service issues. Considering the number of policies they’ve sold over decades, 82 complaints isn’t unusually high.
You’ll find plenty of Colonial Penn reviews online. Some are negative, some positive. Keep in mind that unhappy former employees sometimes post bogus complaints, so take extreme negativity with a grain of salt.
Better Alternatives to Consider
We work with dozens of insurance companies. If you’re considering Colonial Penn, you should also compare:
Royal Neighbors: Competitive guaranteed acceptance rates, strong customer service, women-focused benefits.
Mutual of Omaha: Level benefit policies for those in average health, established company with excellent ratings.
United Home Life: Simplified issue policies (fewer health questions than traditional, but no waiting period).
American Amicable: Good middle-ground options between guaranteed acceptance and fully underwritten.
Most independent agents will try to place you in a level benefit policy first, offering guaranteed acceptance only if you can’t qualify for better coverage.
Pros and Cons of Colonial Penn
What Works:
- Accepts everyone ages 50-85, regardless of health
- No medical exam required
- Legitimate company with decent financial ratings
- Level premiums for life
- Can’t be canceled except for non-payment
What Doesn’t Work:
- Significantly more expensive than competitors (often 40-50% higher)
- Two-year waiting period for natural death
- Confusing unit-based pricing makes comparison shopping difficult
- Lower modified death benefit during waiting period (7% vs. typical 10%)
- High policy loan rate (8%)
- Limited coverage amounts
Key Takeaways
- Colonial Penn is legitimate but expensive – Their guaranteed acceptance policies cost substantially more than competitors offering similar coverage.
- Most people qualify for better options – If you’re in average health with manageable conditions, you’ll likely qualify for level benefit policies with no waiting period at 40-50% lower cost.
- The unit pricing is designed to confuse – Colonial Penn’s unusual pricing structure makes comparison shopping nearly impossible without extensive research.
- Shop around before buying – Get quotes from at least 3-4 companies. Most people are surprised to learn they qualify for much better rates than Colonial Penn offers.
- Use guaranteed acceptance as last resort only – Reserve these policies for situations where you’ve genuinely been declined by multiple insurers due to serious health conditions.
Frequently Asked Questions
What kind of life insurance does Colonial Penn have?
Colonial Penn now focuses primarily on guaranteed acceptance whole life insurance for ages 50-85. They previously offered term life and other products, but have narrowed their focus to final expense/burial insurance that requires no medical exam.
Where can I find a Colonial Penn rate chart?
Colonial Penn doesn’t publish a rate chart. Their unit-based pricing system makes traditional rate charts impossible because coverage amounts vary by age and gender. You’ll need to call for a quote or use their website calculator to see what your specific rate would be. This pricing opacity is one reason we recommend comparing Colonial Penn with competitors who publish clear rate charts.
What does the Colonial Penn $9.95 per unit plan mean?
The $9.95 per unit plan means you pay $9.95 monthly for each “unit” of coverage you buy. The confusing part: each unit provides different amounts of insurance based on your age and gender. A 60-year-old woman might get $1,519 per unit, while a 60-year-old man gets $1,167 per unit. You can buy up to 15 units. This pricing structure makes it difficult to comparison shop with other insurers.
Can I be turned down for Colonial Penn Life Insurance?
No. Colonial Penn’s guaranteed acceptance policy accepts all applicants ages 50-85 with no health questions. You cannot be declined. That’s the main selling point, but it comes with significantly higher premiums than policies that do require health screening.
How much does Colonial Penn life insurance cost?
Colonial Penn prices coverage in units at $9.95 each. The amount of coverage per unit varies by age and gender. A 60-year-old woman might get $1,519 per unit, while a 60-year-old man might get $1,167 per unit. You can purchase up to 15 units. This unusual pricing structure makes Colonial Penn more expensive than most competitors.
Is Colonial Penn a good deal for seniors?
Colonial Penn is rarely a good deal for seniors in average health. Our comparisons show their rates are 40-50% higher than competitors like Mutual of Omaha or AIG. Most seniors can qualify for no medical exam life insurance with better rates and no waiting period. Colonial Penn only makes sense if you’ve been declined by multiple other insurers.
What are better alternatives to Colonial Penn?
Better alternatives include Mutual of Omaha (level benefit policies at lower rates), Royal Neighbors (competitive guaranteed acceptance), United Home Life (simplified issue with no waiting period), and American Amicable (good middle-ground options). Most people in average health qualify for policies that cost 40-50% less than Colonial Penn with immediate full coverage.
How can I compare life insurance rates?
The best way is to get quotes from multiple companies for the same coverage amount. We offer a comparison tool that shows rates from over 40 life insurance companies. You can also work with an independent agent who represents multiple carriers and can show you all your options side by side.
Want to see what you actually qualify for? Most people are pleasantly surprised to learn they can get better coverage at lower rates than Colonial Penn offers. Let’s look at your specific situation and see what makes sense.
