Pros and Cons of Colonial Penn Insurance Review

Pros and Cons of Colonial Penn Insurance

Over the years, Colonial Penn Insurance has become a well-known life insurance brand in the market. It offers both term and whole life insurance to help you prepare financially for your future.

The insurance was established with the main focus to cover people over 65 years in Philadelphia. Today it covers people between the age of 18 and 85.

The insurance company guarantees the issue of whole life insurance to individuals who can’t qualify for traditional life insurance because of multiple health issues. Before purchasing colonial life insurance, look at the following pros and cons.


1. No medical exams: Colonial Penn doesn’t carry out medical exams on any of the three plans. Therefore, you don’t have to worry about getting covered if you have a pre-existing medical condition. You only have to answer a few health questions.

2. Lifetime level premiums: Once the guaranteed acceptance policy is issued to you, your premium will be the same throughout. The insurer cannot increase the rates even if you’re diagnosed with a terminal illness.

3. Build cash value: Both whole and term life insurance plans help you build cash value over time that you can be able to borrow money against. It offers you guaranteed approval.

4. Available to people aged 50 and above: This type of insurance policy is suitable for individuals aged between 50 and 80 years. It is ideal for those who have waited until late in life.

5. 30-day money-back guarantee: If you decide Colonial Penn’s life insurance policy is not for you and cancel it before the 30 days, you get a full refund.    

6. Multiple insurance policies that suit an individual’s needs: There’s a term life insurance policy that is renewed yearly and this means it provides coverage annually, after which it expires and you’ll have to renew. This is a good alternative for those who cannot make life insurance. It is also available for anyone between the ages of 18 and 75, with a renewal of up to 90 years. Whilst the Guaranteed Acceptance Life Insurance is primarily meant for the elderly.

7. Maximum designation of 2 Beneficiaries: Both the term life policy and whole life policy allows the insured to denominate up to two donees. For which the amount of the death benefit each should receive can be customized per the given ratio.e.g 1:1 for an equal share or a different allocation of the division of funds. Again, there’s total freedom of allocating the whole amount to a single beneficiary.

8. Coverage: The death benefit fund could range between $10,000 to $50,000 for both term life and whole life insurance policies, arguably a good amount for the beneficiaries.

9. Flexible payment options: Premium payments can be done on a monthly, quarterly, semi-annually, or annually basis. The company also waives off a month’s premium if paid earlier. This flexibility suits every customer’s economic status.

10. High acceptance rate: As opposed to its competitors, Colonial Penn offers a high acceptance despite the high risks associated with it. But it’s because policyholders can easily buy policies from consumers whose death benefit payout is sufficient to cover the final expenses and pay off a few outstanding bills incurred.

11. Fully-catered funeral expenses: This is possible through the Guaranteed Acceptance Life Insurance that’s primarily meant for elderly people. When the policyholder dies, the family receives a payout sufficient to cover the final expenses, reducing the burden on the family to a small extent.


1. Limited coverage for children: Colonial Penn insurance doesn’t provide coverage for your children. None of their policies indicates that you can add a rider to extend the coverage.

2. High premiums: Compared to other insurance products, Colonial life insurance premiums are high. They offer a small coverage amount of $50000 in any of the plans. Other insurers can offer up to $5 million in coverage.

3. No additional benefits for disability coverage: If you become disabled or in a case where you’re in assisted sitting, the insurance doesn’t offer you any additional benefits.

4. No living benefits: If you’re ever diagnosed with a terminal illness and you have one year or less to live, the insurance company doesn’t give you access to your benefit amount. Some other insurance companies allow the members to have access to all or some of the benefit amount to help them ease the cost.

5. No waivers: If your doctor decides that you should move to an assisted living facility, there are no premium waivers offered to you unlike with other insurers.

6. Consumer complaints: Colonial Penn receives a large number of complaints from its consumers compared to some similar insurance companies. As of the data received at the end of 2019, its customer complaint ratio was 50% higher than the national average.

7. Poor income – long-term finance policy: Colonial Penn is undoubtedly a bad choice for consumers who would wish to apply for a policy meant for replacing income and secure long-term financial needs and sustainability of the dependents.

8. Some policies are biased: It’s unfair for applicants who are relatively young and healthy not to undergo a medical test. Honestly, they need not settle for a non-exam, no-questions-asked policy. Instead, they need the medical test to be classified .s low-risk consumers and get the best possible rates on both term and whole life policies.

9. They only Return 7% of premiums during the waiting period: Their policy constitutes a 2-year graded death benefit limitation. For which your premiums + 7% interest will be returned, this is 3% less than the average premium return. Unless death is through an accident.

10. Limited Coverage Amounts: The death benefit ranges from $10,000 to $50,000. This amount will only be sufficient in the case of minimal final requirements. But if it’ll be required to pay for major financial commitments then the amount would be a drop in the ocean.