Colonial Penn Burial Insurance Review

Written on June 9, 2016 by Choice Mutual

Colonial Penn Burial Insurance Review

Disclaimer: We are not affiliated with Colonial Penn. This Colonial Penn burial insurance review is merely our professional opinion about Colonial Penn and their life insurance products.

If you have purchased a Colonial Penn policy within the last 3 years, you are paying way too much for your burial insurance. Fill out the quote form now to see how much cheaper you can get your burial insurance.

Today we are reviewing one of the most well known players in the final expense business. In this Colonial Penn burial insurance review, we are going to take a hard look at their entire final expense program. Our goal is to leave nothing to the imagination. Unfortunately for them, they are not one of the companies who made our list of best final expense companies.

Colonial Penn Burial Insurance Review

As is the case with all our review pieces, we offer you a choice. You can browse our quick review to get a snapshot opinion of the company and their burial insurance plans. In addition, we also have a full review that breaks down every detail possible. The full review will touch on prices, underwriting, and our opinion about all of it. Either way, we hope you find this review helpful.

 

Our Quick Colonial Penn Burial Insurance Review

Colonial Penn is a financially sound well known insurance company. We will give them credit for the fact that they were the first insurance company to develop a no health question life insurance policy. Aside from that, we really can’t think of anything positive to say about them.

The cold hard truth is their burial insurance product offering is inferior in every way. There simply is no reason why anyone should ever resort to buying final expense insurance from Colonial Penn. The reason we say this is simple. Their products are way over priced, and you can easily get much cheaper coverage from multiple other insurance companies. You should only go with them if you enjoy overpaying.

 

Company Background

For many years Alex Trebek has been the face of the Colonial Penn. As a paid endorser, he regularly promotes the amazing value of Colonial Penn’s burial insurance plans. This review will completely examine their burial insurance program. After reading this article, you will a understand a truth that Alex Trebek won’t tell you. Colonial Penn is very expensive, and you can absolutely get a much better price on your burial insurance elsewhere.

Colonial Penn was started roughly 50 years ago by AARP co-founder Leonard Davis. Colonial Penn is a subsidiary of CNO Financial Group Inc. They are licensed in 49 states, DC, PR, and VI. A.M. Best currently has Colonial Penn rated as B++. In general, its recommended you select an insurance company that has a rating no less than A- with A.M. Best.

Colonial Penn primarily markets via their television commercials that feature the well known Alex Trebek. In the past, they utilized Ed McMahon, Lou Rawls, and Joe Theismann. Colonial Penn also has strong web and direct mail advertising programs. If you search for “final expense, “burial insurance” or “funeral insurance”, you will see their internet ads. Additionally, if you are over the age of 50, you probably get their mail weekly. Colonial Penn Burial Insurance Review

In our view, Colonial Penn has a rather misleading way of describing the cost of its coverage. They always proclaim their coverage starts for as little as $9.95 per unit of coverage. Their use of the word unit is where the subtly comes in to play. They know most people will fail to think:  What exactly is a unit? The truth is, a unit is nothing more than a set dollar amount of coverage.

For example, 1 unit can represent $500 in burial insurance, or it can represent $1000 in coverage. The amount of coverage provided by a single unit is determined by your age and sex. For example, let’s say at your age a single unit provides $1000 in coverage.  If you wanted to have $10,000 in burial insurance protection, how many units would you need? In this example, you would have to buy 10 units. At $9.95 per unit, that would yield a total monthly cost of $99.50.

They use the word “unit” as a form of misdirection. They know how you would respond if they were brutally honest in their advertisements. Think about it for yourself. Imagine if you saw a Colonial Penn TV commercial for their burial insurance. In the commercial Alex tells you that you can get $1150 in coverage for just $9.95 per month. How would you feel about that offer?

Most likely, your first thought would be: “What in the world am I going to do with just $1150 in protection?” or “I need way more than just $1150 in coverage!”.

You would in no way be excited about their “offer”. You would probably completely disregard Colonial Penn’s insurance altogether. They know this is how you and everyone else would react. This is why they resort to employing a subverted version of the truth using the word unit. They aren’t lying, but they are indeed guilty of being less than forward & honest with this approach.

We have spoke to many folks who sincerely thought they were going to get burial insurance from Colonial Penn for just $9.95 per month. They were completely under the impression that a unit of coverage was all they would need to purchase. Fortunately, we were able to explain to them what a unit really is. No other final expense insurance company speaks in code as they do. All the others tell you what you pay for whatever amount of coverage you want.

Today, Colonial Penn has two main burial insurance programs. Their most popular plan is their guaranteed acceptance whole life burial insurance. Their second plan is an easy issue whole life burial insurance plan that requires applicants to answer some health questions. We will go over their guaranteed issue burial insurance first. They market this plan the most.

 

The Full Colonial Penn Review

Now you are at the point where you are going to read about all the little Colonial Penn details. We have taken a magnifying glass to all their final expense insurance plans to become experts at how they work. You will find underwriting criteria, pricing information, policy provisions explained, and our sincere unbiased professional opinion about all of it. We can confidently say (we searched) that you simply will not find a more exhaustive and complete Colonial Penn burial insurance review than what you are about to read.

Colonial Penn burial insurance review

Colonial Penn’s “Guaranteed Acceptance” Burial Insurance

Overall plan grade= D

Quick facts on this plan

  • Coverage from $418 to $16,664
  • Coverage does not expire
  • No health questions or medical checks
  • Payments will not change

This is a true permanent burial insurance plan. It’s rather simple to understand. It will not expire. The monthly price will not change. The benefits will never decrease. It also has a waiting period. The main drawback with this plan is the price. Quite frankly, the price for their guaranteed acceptance burial insurance is considerably higher than many competitors. More specifically, Gerber Life and Mutual Of Omaha can offer the exact same product at a substantially lower price.

They guarantee they will approve you for this burial insurance plan. Regardless of your health, they will accept you. They don’t ask any health questions or check your medical history. Because they issue the policy to everyone without checking their health, there is a two year waiting period. If you should pass away during this two years, Colonial Penn will not pay out the benefit amount. They would refund all your premiums plus 7% interest compounded annually.

Insider Tip: If you currently have this guaranteed acceptance plan from Colonial Penn, you should know that you might be able to qualify for burial insurance plan that DOES in fact pay benefits during the first two years and will likely be cheaper. Over 90% of our customers qualify for an immediate benefit plan. Fill out the quote form today and we will see if we can get you a lower rate and get you protected from day one.

After the two years has passed, the full face amount is effective and will remain so for the rest of your life. It’s worth noting that during the waiting period, the policy will pay out if death is caused by an accident. For example, if you passed away in a car/plane/train crash, they would pay the full benefit amount.

This coverage is available to anyone who is age 50-85. You can make your payments monthly via a bank draft using your routing and account number. You can also make your monthly payments using a credit card. If you would prefer to pay them manually via direct bill, they give you three options. You can pay 3 months at a time (quarterly). You can pay them six months at a time (semi annually). Finally, you can pay 12 months at a time (annually). You cannot make monthly payments via direct bill. Monthly billing must be done either by bank draft or credit card.

It would certainly be better to have this plan than to have nothing at all. Having said that, you can easily get a far better price for the exact same thing. There simply is no reason why anyone should ever buy their guaranteed acceptance burial insurance. The free enterprise system has given birth to many competitors that charge much less for the exact same thing.

 

The “Immediate Benefit” whole life plan with Colonial Penn

Overall plan grade= D

Quick facts on this plan

  • Coverage up to $50,000
  • The policy does not expire
  • Qualification is based off health questions
  • Payments will not change

This plan is also true permanent burial insurance. It will not ever expire. The monthly payments cannot change. The benefits cannot decrease. If you are accepted, there is no waiting period. Your coverage is effective starting on day one. People who smoke, chew tobacco, or use e-cigarettes, do not have to pay an increased premium. The only downside with this burial insurance is the price. As is the case with their guaranteed issue product, you can get it cheaper somewhere else.

Qualification is based on your answer to the following health questions:

  1. Are you using a wheelchair, using oxygen to assist with breathing, confined to a hospital or nursing facility, receiving home health or hospice care, or are you currently disabled due to illness?
  2. Have you had or been treated for Acquired Immune Deficiency Syndrome (AIDS), AIDS Related Complex (ARC), or tested positive for antibodies to the Human Immunodeficiency Virus (HIV)?
  3. In the past 3 years, have you had or been treated for:
    • Chronic Obstructive lung disease, coronary artery disease, or any disease or disorder of the heart brain or liver?
    • Cancer, chronic kidney disease or kidney failure, muscular disease, mental or nervous disorder, drug or alcohol abuse, or have you been hospitalized for diabetes?
    • Any chronic illness or condition which requires medication or periodic medical care, or have you been advised to have surgery which has not been performed?
  4. Are you currently undergoing evaluation, diagnostic testing or treatment, or been advised to have testing not yet completed?

If you answer yes to any of these questions, you will be declined. If you are declined, they will then push you to take their guaranteed acceptance policy. The massive problem with this scenario is that our experience shows that most folks genuinely are not best served by a no health question policy.

Quick tip: If you recently got a guaranteed acceptance final expense policy from Colonial Penn or any other insurance company, contact us immediately. There is a really good chance you can qualify for a policy that DOES pay benefits during the first two years, and will probably cost less. Fill out the quote form and we will review your situation and give you unbiased feedback.

As previously mentioned, guaranteed issue policies have a mandatory two year waiting period. They are also more expensive. As you can imagine, guaranteed issue policies attract people with some very serious health issues. For this reason, the insurance companies have to charge more for the insurance to offset the paying of more death claims.

There are dozens of different burial insurance companies on the market. Additionally, they all accept people with different health conditions. For example, there are some companies that have no issues with diabetes. On the other hand, some insurance companies charge extra for people who have diabetes. This happens with most health issues. This is why it’s critical you work with an agency that is independent. The ability to choose from ALL the different final expense companies is how you can surely get the best price.

On average, 90% of the people we speak with should get a policy that does have health questions. We say this because they get a better price and typically avoid waiting periods. Ask yourself: Do I want to pay more money per month and have a waiting period? Of course you don’t!

Guaranteed issue burial insurance is typically only appropriate for people with very serious and recent health ailments. A professional experienced agency like ourselves can surely diagnose your situation to determine if guaranteed issue is in your best interest. If in fact you are one of the few people who truly needs a guaranteed issue policy, do not get it from Colonial Penn. They are far more expensive than most other carriers. Look at Gerber or Mutual of Omaha. Those two have the best prices on the market.

This burial insurance by Colonial Penn is good in the sense that it is real burial insurance. Believe it or not, there are many companies that will try to trick you. They will present you with fake burial insurance plans that expire at a certain age. AARP and Globe Life both do this all the time. We have personally spoken to many unfortunate customers who fell victim to this sort of thing. Most every one of them never knew the policies would expire at some point.

Companies that try to deceive you like this, bank on you not reading the policy. Do not be fooled by these schemes. Always read your policy (no matter who you buy from. Even us!). Make sure your policy is consistent with what you were told up front. If something does not match, call the insurance company directly and ask questions. Take comfort knowing that you have the right to cancel any insurance contract at anytime. No insurance company can stop you from doing this.

Again, Colonial Penn thankfully is not a company that tries to sell you fake burial insurance. We will give them that much. Having said that, this immediate benefit burial insurance plan is more expensive compared to many other carriers on the market. If you would prefer to get your burial insurance cheaper, fill out the quote form. We will show you many other companies that beat Colonial Penn’s prices handily.

 

Colonial Penn Summary

Colonial Penn is a well known company with the very popular paid endorser Alex Trebek. Fortunately, they do not try to push seniors into a plan that expires. This is more than can be said for some companies out there. Colonial Penn’s two products are straightforward and easy to understand. Neither of their products will expire, both have fixed monthly prices, and the benefits will never decrease.

We believe in telling it like it is. With that statement, there is literally no condition which ANYONE should ever buy from Colonial Penn. They would simply be spending extra money for no reason whatsoever. In our opinion, Colonial Penn has two major downfalls.

The most glaring problem is the price of their insurance. Both of their burial insurance plans are expensive. Alex Trebek must charge them a lot of money or something because their rates are far higher than most competitors. There are so many other insurers that offer the same exact thing for much less money.

The second drawback is the lack of an independent agent. With Colonial Penn, you do not have a dedicated independent agent to service you. You basically have a customer service representative who is licensed to sell insurance. They will surely sign you up for an overpriced Colonial Penn policy and answer your questions. However, that is about all they can do for you.

Here’s the significant issue most people never consider. As time goes on, things change. They always do. Change often breeds new insurance needs in your life. Chances are, you will probably need to add or change your coverage in the future. Furthermore in the future, your health, your budget, and your lifestyle will surely be different than today. We see it all the time.

Because your situation will be different than today, there is no telling which insurance company will be the best fit for you. Do you still want to get the best price and coverage in the future? Of course you do.

We may recommend the company you started with. However, it may be a different insurer altogether. Remember, we are an independent agency. We work for you. We aren’t concerned so much about which insurance company we put you with. All we care about is getting you the most coverage for the lowest price.

If you have an insurance need in the future (which you probably will), we want to be able to faithfully serve you. We will not default to the insurance company you started with. We will take a fresh look at your situation. We will again sort through all the insurance companies, and pick which one is best for you at that time. If it happens to be the same company we initially put you with, so be it. If it should be a different insurer altogether, that’s just fine as well. Since you are the goal, we will always do what is best for you and your pocketbook.

In our experience, the following events happen very often. Expect to encounter at least one, if not many of the following:

  • You want to add coverage to your policy
  • You want to get or add coverage on your spouse
  • Your kids, your relatives, your friends, want to get some burial insurance
  • You have a term policy and you need to convert to a permanent burial policy
  • Someone you know has a term policy that needs to convert to a permanent plan

Regardless of when, we will properly assist you, your spouse, or anyone else you know. We can and always will do whatever is best for you or them. You have our word on that. Being independent is what allows us to follow through on this commitment. We have the choices to enable this level of service.

As for Colonial Penn, everyone can do better somewhere else. Unless you are a die hard super duper Jeopardy fan, save money by avoiding them.

About ChoiceMutual.com
About ChoiceMutual.com

Choice Mutual works with all the top burial insurance companies throughout the nation to secure you the best price possible.

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4 Comments

You said they ask 7 questions. I only saw 4 : 1. 2. 3. 4. No 5. 6.or 7.

February 20, 2017 at 4:52 pm
    Choice Mutual

    Hi Julie,

    You caught an error! Thanks for the heads up. We made the correction.

    There’s actually 6 questions not 7 like we originally wrote. Take a look at #3 on that list. It has 3 separate questions within itself.

    Thanks again for the keen eye!

    February 20, 2017 at 7:21 pm
paul Murray

I’m interested in some type of burial package. Perhaps even some type of a small life insurance policy whole life I would think is ideal. Right

March 15, 2017 at 1:57 pm
    Choice Mutual

    Hi Paul,

    Thanks for reaching out. We sent you an email about this. We will help you find what you are looking for 🙂

    March 15, 2017 at 2:05 pm
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