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Colonial Penn insurance review 2023

Updated Mar 09, 2023
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Bottom Line

Colonial Penn Life Insurance Company offers a few different types of life insurance to fit the needs of a range of customers. Universal life insurance isn’t available, though, and whole life policies have a low $50,000 maximum death benefit.

  • Customer service available in Spanish and English

  • Live chat is available

  • Rated A (Excellent) by AM Best for financial strength

  • Offers guaranteed acceptance life insurance

  • Doesn’t offer universal life insurance or variable universal life

  • More complaints than the expected baseline were filed with the National Association of Insurance Commissioners (NAIC)

  • Low coverage limit of only $50,000 for permanent life insurance

Colonial Penn life insurance

Colonial Penn life insurance may be an option worth considering, according to Bankrate’s analysis, especially for shoppers over age 50 looking for life insurance.

Colonial Penn offers guaranteed acceptance life insurance and whole life insurance, but it does not offer a range of permanent and universal life insurance options. If you’re looking for term life insurance or other types of life insurance, you may have to turn elsewhere.

  • Permanent: Colonial Penn offers whole life insurance, which is a type of permanent life insurance policy. These types of policies remain in effect for the duration of your life or as long as you pay your premiums. 
    • Whole life insurance comes with a cash value account designed to accumulate interest and returns, which you may be able to use to pay your premiums or borrow against. Colonial Penn’s whole life insurance policy is available to those between the ages of 40 and 75 in most states, with the maximum coverage amount being $50,000. That coverage limit is considerably low compared to other life insurance companies, so whether or not Colonial Penn is the right company for you depends on how much coverage you need. For Colonial Penn’s guaranteed acceptance policies, the maximum coverage amount depends on your age and state. 

      This policy requires the insured to answer health questions but not complete a medical exam. It may be a good fit for those who want lifelong coverage with a low death benefit and a cash value account, without a required medical exam.
  • Guaranteed: Guaranteed acceptance life insurance is another permanent policy type available through Colonial Penn, which may be a good choice for individuals with health issues that prevent them from passing a traditional life insurance policy’s medical exam screening process. In most states, Colonial Penn’s guaranteed life insurance is available for those between the ages of 50 and 85. Colonial Penn issues coverage for its guaranteed acceptance policies in units, with each unit being $1,000 worth of coverage. The number of units available to you may depend on your age, gender, and the state you live in.

    Guaranteed acceptance life insurance policies don’t require a medical exam for an applicant to be approved. However, premiums are typically high and have a comparatively low death benefit.
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Colonial Penn life insurance endorsements

Colonial Penn’s life insurance endorsement options are sparse, but you may be able to include a living benefit rider on your whole life policy. This endorsement can allow you to access up to 50 percent of your death benefit if you are diagnosed with a qualifying illness.

Colonial Penn life tools and benefits

Colonial Penn does not advertise any other tools or benefits for life insurance customers on its website.

Colonial Penn customer satisfaction

Getting a good rate is only one consideration when shopping for life insurance. Third-party ratings can also give you an idea of whether insurers that have the financial strength to meet their claims obligations or whether their customer service is up to par.

You can find financial strength ratings on the websites of the three top rating services, AM Best, Moody’s and Standard and Poor’s. You may also be looking for carriers that have a good record of customer care. Each year, J.D. Power publishes its U.S. Individual Life Insurance Study, which ranks the top providers in the market and assigns an overall customer satisfaction score, based on a 1,000-point scale. The survey bases its findings on five factors, including communication, customer interaction, product offerings, rates and statements.

Colonial Penn life insurance claims

AM Best gives Colonial Penn an A (Excellent) financial strength rating. This means that the provider has the historically excellent ability to meet its claims responsibilities. However, in 2021, the carrier scored poorly in the NAIC’s complaint index report. According to the report, the NAIC received 94 customer complaints about its individual life product in 2021, earning it a 22.18 company complaint index score, much higher than the industry average. Colonial Penn was not ranked as part of the 2022 J.D. Power life insurance survey.

How to file a claim with Colonial Penn

Your beneficiary may be stressed as they file your life insurance claim. To help ease some of their burdens, you may want to let them know what the process will entail ahead of time.

To file a life insurance claim with Colonial Penn:

  • First, your beneficiary will submit a form called "Claimant's Statement For Life Insurance Death Benefits." The provider typically includes the form in the insurance policy documents, but you can also request one by mail or phone or download one at the Colonial Penn website. Colonial Penn enables your beneficiary to submit the claim form, along with the death certificate and any other required paperwork, online or by fax or mail.
  • Within one to two weeks, Colonial Penn will then assign the claim to a claims associate. In some cases, the associate may request additional documents, such as estate or trust paperwork. After receiving all required documents, the claims associate will determine eligibility for benefits within one to two weeks. Bear in mind that claims time frames vary.
  • Once approved, Colonial Penn and Washington National customers will receive payment by mail. Bankers Life customers may receive contact from an agent to arrange payment delivery.

If your beneficiary has any questions during the claims process, they may find it helpful to contact Colonial Penn directly. You may also want to let your beneficiary know where your life insurance documentation is stored prior to your passing.

Colonial Penn availability

Colonial Penn licensed to sell life insurance policies in the District of Columbia and all states except New York. However, Bankers Conseco Life Insurance Company underwrites Colonial Penn life insurance policies for New York residents. However, it’s important to know that Colonial Penn agents work remotely, so they may not be directly available in your local area or state.

Other Colonial Penn perks worth considering

Colonial Penn does not offer policy management through a mobile app, but the following perks may be of interest.

  • Instant chat feature: The company’s website features a chat box where you can ask questions and receive answers from a real agent in as little as a few seconds.
  • Living Insurance endorsement: Living Insurance is an accelerated death benefit, which means you can take out up to 50 percent of your death benefit before you pass away if you’re diagnosed with a covered illness. Approved illnesses typically include heart attacks, strokes, cancer or certain chronic illnesses. You can contact a Colonial Penn agent regarding the specific details of your situation to determine your eligibility.

Colonial Penn corporate sustainability

Colonial Penn states that Diversity, Equity & Inclusion (DE&I) is among one of its top core values. Additionally, the company has maintained a partnership with the American Heart Association (AHA) since 2020. This partnership aims to support the AHA’s Healthy for Good campaign, which encourages heart-healthy habits like eating well and regular exercise.

This Colonial Penn life Insurance review may have you wondering if this is the company for you. If you’re looking for a type of life insurance policy that Colonial Penn doesn’t offer, then you may want to compare quotes from some (or all) of the companies below:

Colonial Penn vs. State Farm

While Colonial Penn does not offer term life insurance, State Farm won a Bankrate Award for the best term life insurance company. The provider also sells universal and whole life insurance, along with auto, business, health and home insurance products. State Farm offers a 24/7 payment line, a network of local agents and an easy-to-use mobile app. If these features are important to you or you are interested in a term life insurance policy, you may want to consider State Farm.

Learn more: State Farm Insurance review

Colonial Penn vs. MassMutual

MassMutual earned a Bankrate Award for best whole life insurance. The company earned this title for its high AM Best financial strength score, high coverage capacity and numerous whole life policy riders. The carrier also sells term life insurance, along with universal and variable life policies, which Colonial Penn does not offer. If you’re looking for a whole life insurance provider with a high coverage capacity, you may want to check out MassMutual.

Learn more: MassMutual life insurance review

Colonial Penn vs. Nationwide

Nationwide won a Bankrate Award for best universal life insurance, largely due to the company’s wide range of riders, high J.D. Power score and accessible network of local agents. The company also offers term life, variable life and life insurance for children. Additionally, Nationwide life insurance policies enable you to add a long-term care rider, which can help pay the costs of home or nursing home care. If you’re interested in universal life insurance or looking for features like the ones mentioned above, you may want to check out Nationwide.

Learn more: Nationwide Insurance review

Is Colonial Penn a good insurance company?

Since 1972, Bankrate’s been a trusted voice in the financial services industry (at that time, we were a print publication known as the Bank Rate Monitor). Fast forward to today, where our insurance editorial team (with almost 50 years of combined experience) uses our expertise to conduct unbiased reviews of the largest carriers by market share.

Colonial Penn life insurance has written life insurance policies for more than 60 years and was one of the first to offer guaranteed acceptance life insurance, making it a recognizable name in life insurance. It was awarded an A (Excellent) financial strength rating from AM Best, indicating that it has historically been able to pay out claims to customers. If you’re looking for guaranteed acceptance, renewable term and whole life insurance, Colonial Penn may be worth considering. However, Colonial Penn Life Insurance may not be right for everyone, and you may need to look elsewhere if you’re looking for universal life or variable universal life.

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