Colonial Penn Life Insurance Explained

Surely you’ve seen the Colonial Penn life insurance ads. You’re guaranteed to be insured. Regardless of your health status. For only $9.95 a month. The three Ps: Price, Price, and Price. Single price for everyone, age 50-85, with exceptions in some states. All that sounds like a great deal and in some ways it is. It all depends at what you’re looking to get covered. If you’re expecting to get a $100,000 coverage, then this option is not the way to go. The $9.95 a month gets you coverage of $10,000. Yes, $10,000! That’s it. It is a coverage that helps you cover part of final expenses, but not much more.

You Can Get More Coverage

Since $10,000 is not a great amount, Colonial Penn allows its clients to purchase more units. Each unit of coverage costs $9.95 and gets you $10.000 death benefit. The maximum number of units you can purchase is 8. Simple math, you can get $80.000 coverage. But, to get to that coverage level, it will cost you $79.60, not the advertised $9.95.

Why Doesn’t Colonial Penn Require a Medical Exam?

Colonial Penn is a so called guaranteed issue life policy. It is a product, which is not exclusive to this company. There are options available. Just like anything else, it is a good idea to shop around. As a rule, any guaranteed issue policy doesn’t require a medical exam to be underwritten. The reason is that the coverage is limited or doesn’t start in the first year or two. This gives the policy issuer a type of a buffer against poor health and fraud. With regular policies, which require a medical exam, your coverage starts immediately. In case of Colonial Penn, you must wait two years to get full, unrestricted coverage.

In Closing

Every product on the life insurance market has its client base. Colonial Penn is a low priced product, permanent, but with not much coverage. It doesn’t offer you many benefits and has long waiting period before full coverage begins. If you want to explore an alternative, then take a look at this guaranteed issue policy we can offer you.

If you’re looking for a more complex, extensive policy, which you can tailor to your specific needs, then forget guaranteed issue products. You can fill out this form here and we can get a conversation started.

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