The Colonial Penn Life Insurance Company is a pioneer in providing secure life insurance plans to individuals in their old age. They started this policy in the 1950s when no other company was offering this type of insurance. Colonial Penn provides life insurance plans for the ages between 18 to 85 but their most famous product is their whole life insurance policy.
Who is eligible?
Any senior between the ages between 50 to 85 can obtain this policy. This is available up to a maximum of $100,000, depending upon the assessment of your health. Normally, insurance companies ask you various questions regarding your medical history. There are four sections to the questioning. If your answers are accepted in the first round, you need not proceed to the next. If any issues are found in your answers regarding your health, you will then be asked to answer the following set of questions.
If the company is satisfied with your health, they offer you a higher face value policy at an affordable rate. If they find any medical issues, you will be asked to take a medical exam after which they will reassess your eligibility. Most often, people with medical conditions are not eligible for life insurance. If there is a policy that will cover you, it may have high premium rates.
Basics of the policy
The Colonial Penn Life Insurance Policy is a guaranteed life insurance policy. It is not recommended for healthy’ seniors. This policy is for those who have been rejected by other insurers due to their medical issues. You will not be asked to take a medical exam, nor will you be asked detailed questions about your medical history. There is a fixed benefit and a fixed premium. Once the contract has been made, the terms and conditions cannot be changed.
What are the drawbacks?
This policy has one clause that is imperative to understand. The policy has a limited benefit period of 2 years. You are not eligible to receive the full benefits package before 2 years. In the first year, only the amount of the premium paid and 7% compounded interest is paid. However, after two years one is eligible for full benefits. This policy is permanent and you have to pay the premium throughout your life. It is valid until the time you are paying the premium. Just like any other insurance policy, once you stop paying the premium the policy expires and the deposited money is not available to you anymore.
Why the Rate is Higher than Other Companies
If you buy this policy at the age of 52, you have to pay a premium of about 150 per month if you opt for the $50,000 policy. This means that you will have to live until at least the age of 82 to have a return equivalent to your investment. Your family will receive the full face value.
As you get older, the rates for the premiums are much higher as the level of risk of death is also much higher. As the risk increases, the rate of return decreases. Colonial Penn Life Insurance is not recommended for younger adults nor is it recommended for healthy older adults. Very few companies offer life insurance for unhealthy, aging adults. However, at Colonial Penn, life insurance is only offered to these individuals. The insurance policy offered by Colonial Penn has the best return rates and contractual clauses.
Who Should Be Shopping for This Policy?
If you are a senior with health issues and you have been turned down by other insurers, then Colonial Penn could be an option for you. Like most seniors, you are likely worried about your liabilities being a burden for your loved ones after your death, which is the most important reason to look into life insurance in the first place.
If your health is good, then you can save a lot of money and get more coverage by looking at other policies with other companies.
The bottom line is that Colonial Penn has it’s place in the senior insurance marketplace, but it is not a good choice for all.
Compare Rates from Several Companies
Whether you decide to go with Colonial Penn or not, it would be wise to compare rates and offers from several different companies to make sure that you get the best possible rate. Life insurance is one of those things that you make payments on for many years so saving on your premium can add up over time. Get going with the first step in the life insurance buying process and compare rates from various companies. From there you can narrow down your choices and secure a policy as well as your peace of mind.