Colonial Penn Life Insurance: Can You Hold Two Policies?

Colonial Penn offers guaranteed acceptance whole life insurance, which is a type of whole life insurance in which applicants are issued a policy regardless of health. With no medical exam or health questions to answer, acceptance is guaranteed. The company provides accessible life insurance solutions with fixed premiums, and policies that build cash value. The coverage amount starts at $9.95 a month per unit, with multiple units purchasable to increase the death benefit. However, it's important to note that Colonial Penn has received a high number of consumer complaints and offers low maximum coverage amounts. Before applying for any insurance, it's recommended to research and compare multiple options to find the best fit for your needs.

What is guaranteed acceptance life insurance?

Guaranteed acceptance life insurance is a type of whole life insurance policy that provides coverage for individuals who may otherwise struggle to get insured due to health reasons. This type of insurance does not require applicants to undergo a medical examination or answer health questions, and acceptance is guaranteed regardless of pre-existing conditions.

The benefit period for guaranteed acceptance life insurance is limited to two years, during which time the policyholder will only receive the full death benefit if their death is accidental. If the policyholder dies from non-accidental causes during this period, the beneficiary will receive a return of premiums paid with interest. After the two-year period, the full death benefit will be paid out regardless of the cause of death.

Guaranteed acceptance life insurance is often more expensive than typical term and whole life policies because it is considered riskier. The policyholder can also not access the benefits immediately due to the initial waiting period.

This type of insurance is ideal for individuals with pre-existing conditions, those who want to ensure their funeral and burial costs are covered, and those concerned about medical or hospital expenses.

How does guaranteed acceptance life insurance work?

Guaranteed acceptance life insurance is a type of whole life insurance policy that offers coverage regardless of the applicant's health. This means that applicants are not required to undergo a medical examination or answer health-related questions. Acceptance is typically guaranteed for individuals with pre-existing conditions.

This type of insurance usually has a limited benefit period, often featuring a waiting period before the benefits take effect. For instance, Colonial Penn's guaranteed acceptance whole life insurance plan has a two-year limited benefit period. During this initial period, if the policyholder passes away from non-accidental causes, the beneficiary will not receive the death benefit but will be reimbursed for all paid premiums with interest.

Once the waiting period ends, the guaranteed acceptance life insurance policy functions like a standard whole life insurance policy, with the added benefit of locked-in premium rates. This means that the premium amount will not increase for as long as the coverage lasts. The benefit amount also remains the same and is not reduced due to age.

With guaranteed acceptance life insurance, coverage cannot be cancelled as long as the policyholder continues to pay the premiums. Additionally, the policy begins to build cash value over time, which the policyholder can borrow against at a guaranteed interest rate.

This type of insurance is particularly useful for individuals with serious health issues or pre-existing conditions who may otherwise struggle to obtain traditional life insurance coverage. It provides peace of mind and helps ensure that loved ones will not be burdened by final expenses, such as funeral and burial costs, or any outstanding medical or hospital bills.

What is the benefit of guaranteed acceptance life insurance?

Guaranteed acceptance life insurance is a type of whole life insurance that offers permanent coverage for an individual's entire life. It is characterised by its guaranteed acceptance, meaning applicants are not required to undergo medical examinations or answer health-related questions during the application process. This form of insurance is particularly beneficial for individuals who may struggle to obtain traditional life insurance due to advanced age or serious medical conditions. Here are some key advantages of guaranteed acceptance life insurance:

No Medical Exams or Health Questions

One of the most significant benefits of guaranteed acceptance life insurance is the absence of medical exams or health-related questions during the application process. This feature makes it accessible to individuals who might otherwise be denied coverage due to pre-existing health conditions or other factors. It also simplifies and accelerates the process of obtaining life insurance, making it more convenient for applicants.

Lifelong Coverage

Guaranteed acceptance life insurance provides permanent coverage that lasts for the entirety of the policyholder's life, as long as they continue to pay the premiums. This lifelong coverage ensures peace of mind and financial protection for the insured and their loved ones.

Locked-in Premium Rates

With guaranteed acceptance life insurance, the premium rates are locked in and guaranteed to remain unchanged for the duration of the policy. This stability helps individuals budget and plan their finances effectively without worrying about unexpected increases in insurance costs.

Flexible Payment Options

This type of insurance often offers flexible payment options, allowing individuals to pay their premiums monthly, quarterly, semi-annually, or annually. This flexibility accommodates different financial situations and preferences, making it easier for policyholders to stay current with their payments.

Cash Value Component

Similar to other forms of permanent life insurance, guaranteed acceptance life insurance includes a cash value component. This means that the policy builds cash value over time, which can be borrowed against or used as collateral for a life insurance loan. This feature enhances the policy's overall value and provides additional financial options for the policyholder.

Ease of Application

Guaranteed acceptance life insurance offers a straightforward and simplified application process. Without the need for medical exams or extensive health questionnaires, individuals can obtain coverage quickly and efficiently, often with instant approval.

What is the cost of guaranteed acceptance life insurance?

Guaranteed acceptance life insurance is usually a whole life insurance policy with a limited death benefit. This type of insurance is often more expensive than other types of life insurance because the insurer has no health details and assumes the insured is high-risk. Quotes are based on age, location, and sex.

The cost of guaranteed acceptance life insurance varies depending on the insurer and the insured's age, gender, and state of residence. For example, Colonial Penn's guaranteed acceptance whole life insurance offers coverage starting at $9.95 a month for those aged 50-85 (in most states). Gerber Life Insurance offers guaranteed life insurance for as little as 59 cents a day for US citizens between the ages of 50 and 80.

It's important to note that guaranteed acceptance life insurance typically comes with a two- to three-year waiting period. If the insured dies during this time due to natural causes, beneficiaries will not receive the full death benefit but rather the amount of money paid in premiums plus interest.

How do I apply for guaranteed acceptance life insurance?

Guaranteed acceptance life insurance is a type of whole life insurance. It is a permanent life insurance policy that lasts your entire life. Generally, guaranteed acceptance plans are insurance policies with a limited benefit period and applicants are not asked health questions or required to take a medical exam. Acceptance is guaranteed regardless of pre-existing conditions.

Step 1: Choose your coverage amount

Get a quote to see benefit amounts and premiums available to you for up to 25 units of coverage.

Step 2: Complete your application

The application process is simple and only takes minutes to complete.

Step 3: Acceptance is Guaranteed!

Get started with a free insurance quote.

There are no health questions asked. The benefit is limited for the first two years.

Additional Information:

• You can cancel your plan for a full refund within 30 days.
• You don't have to answer any questions about your health or take a physical exam. Your acceptance is guaranteed!
• After your coverage begins, your benefit will not decrease as you grow older or if your health changes. Acceptance is guaranteed because of a limited benefit for death during the first two years.
• Once your coverage takes effect, your rate will stay the same as long as you keep your insurance.
• Your coverage can stay in force as long as you pay your premiums when due.
• If your coverage is in force and has a cash value, you may obtain a loan on it. The interest rate is 8% compounded annually. Any loan amount and interest that has not been repaid at the time of death is deducted from the death benefit.
• Your guaranteed acceptance life insurance plan will pay benefits directly to your beneficiary or beneficiaries in addition to any other insurance you might have.

Frequently asked questions