Colonial Penn 999 Plan Review (Updated for 2025)

Understanding the Colonial Penn 999 Plan in 2025

You’ve likely seen the commercials featuring Alex Trebek or Jonathan Lawson talking about life insurance for just $9.95 a month. This is the widely advertised Colonial Penn 999 Plan, a guaranteed acceptance whole life insurance policy. But what exactly do you get for that $9.95, and is it the right choice for your final expense needs? This article provides an updated look at the Colonial Penn 999 plan for 2025, helping you understand its structure, benefits, limitations, and how it compares to other options available in the market.

Making informed decisions about life insurance is crucial. It’s about securing peace of mind for yourself and your loved ones. While the simplicity of a $9.95 price tag is appealing, life insurance isn’t a one-size-fits-all product. What works perfectly for one person might be completely inadequate or overly expensive for another, depending on their age, health, financial situation, and coverage goals. That’s why exploring all your options is so important. At Insurance By Heroes, an independent agency founded by a former first responder and military spouse, we understand the importance of finding coverage that truly fits your unique circumstances. Our team, many with public service backgrounds themselves, specializes in helping people navigate the complexities of insurance by comparing offers from dozens of top-rated carriers.

What Exactly is the Colonial Penn 999 Plan?

The Colonial Penn 999 Plan is a specific type of life insurance policy known as Guaranteed Acceptance Whole Life Insurance. Let’s break down what that means:

• Guaranteed Acceptance: This is a key selling point. As the name suggests, your acceptance into the plan is guaranteed if you fall within the eligible age range (typically 50 to 85, though this can vary by state). There are no medical exams to take and no health questions to answer. This can be a significant relief for individuals who have pre-existing health conditions that might make them ineligible for other types of life insurance.
• Whole Life Insurance: Unlike term life insurance, which covers you for a specific period, whole life insurance provides coverage for your entire life, as long as you continue to pay the premiums. It also builds cash value over time, which you can potentially borrow against (though doing so reduces the death benefit).
• The “$9.95 per Unit” Structure: This is where the “999 plan” name originates and often causes confusion. You don’t buy a specific dollar amount of coverage directly. Instead, you purchase “units” of coverage, and each unit costs $9.95 per month. The amount of life insurance coverage each unit provides depends heavily on your age, gender, and sometimes your state of residence at the time you purchase the policy. Generally, the older you are when you buy a unit, the less coverage that unit provides.

It’s crucial to understand that $9.95 per month does not buy a fixed, substantial death benefit. It buys one unit, and the actual coverage amount for that unit might be quite small, potentially only a few hundred dollars for older applicants. To get a meaningful amount of coverage, most people need to purchase multiple units, significantly increasing the total monthly premium well beyond the advertised $9.95.

How the 999 Plan Works: Units, Coverage, and Costs

The core mechanism of the Colonial Penn 999 plan revolves around its unit-based system. Here’s a closer look:

• Buying Units: When you apply, you decide how many units you want to purchase, up to a maximum limit (often around 12-15 units, depending on the state and specific regulations). Each unit costs $9.95 per month. So, if you buy 5 units, your monthly premium will be 5 x $9.95 = $49.75.
• Coverage Per Unit: The death benefit associated with each $9.95 unit is pre-determined based on your age and gender when the policy starts. For example, a 55-year-old male might get $1,500-$1,700 in coverage per unit, while a 75-year-old female might only get $500-$600 per unit (these are illustrative examples; actual amounts vary). Colonial Penn provides charts detailing the coverage per unit based on these factors.
• Calculating Total Coverage: Your total death benefit is the coverage amount per unit multiplied by the number of units you purchase. If one unit provides $1,000 of coverage for you, and you buy 8 units, your total death benefit would be $8,000, and your monthly premium would be 8 x $9.95 = $79.60.
• Maximum Coverage Limits: Because the coverage per unit decreases with age and there’s a limit on the number of units you can buy, the maximum possible death benefit you can obtain through the 999 plan is often relatively low compared to other life insurance policies. It’s typically designed for final expenses (like funeral costs, small debts) rather than income replacement or large estate planning needs. Maximum coverage often caps out between $10,000 and $25,000, depending on age and the number of units purchased.

This unit structure can make it difficult to directly compare the cost-effectiveness of the Colonial Penn 999 plan against other policies that quote a specific death benefit for a specific premium. It requires an extra step of calculation. Remember, while guaranteed acceptance sounds appealing, it often comes with trade-offs in terms of coverage amount and cost per thousand dollars of insurance. Comparing options through an independent agency like Insurance By Heroes allows you to see quotes for specific coverage amounts ($10,000, $25,000, $50,000, etc.) across various companies, making value comparison much clearer.

The Critical Detail: The Graded Death Benefit Period

Perhaps the most important aspect of the Colonial Penn 999 plan – and many other guaranteed acceptance policies – is the **graded death benefit**. This is a detail often mentioned quickly in advertisements but has significant implications.

Here’s what it means:

• Limited Payout in First Two Years: If the insured person passes away due to natural causes (illness or disease) during the first two years the policy is in force, Colonial Penn will typically not pay the full death benefit.
• What is Paid Instead?: During this initial two-year period, the beneficiary usually receives only a return of the premiums paid into the policy, possibly with some interest (often around 7-10%).
• Accidental Death Exception: The graded death benefit usually does not apply if the death is accidental. In the case of a covered accidental death, the full face amount of the policy is typically paid out, even within the first two years.
• After Two Years: Once the policy has been in force for two full years, the graded period ends. From that point forward, the full death benefit amount (based on the number of units purchased) will be paid upon the insured’s death, regardless of whether the cause was natural or accidental.

Why is this graded benefit period used? It’s how the insurance company manages the risk of insuring individuals without asking health questions or requiring a medical exam. By limiting the payout for non-accidental deaths early on, they protect themselves from situations where someone might purchase a policy knowing they have a very short life expectancy due to illness.

However, this is a major drawback for consumers seeking immediate full coverage for final expenses. If the primary goal is to cover funeral costs immediately, a policy with a two-year waiting period for the full benefit might not be the ideal solution. Many other life insurance options exist, including some simplified issue policies (with a few health questions but no exam) or even certain other guaranteed issue policies, that may offer full coverage from day one or have shorter waiting periods. This is precisely why comparing the market is essential. An independent agency like Insurance By Heroes can show you policies from various carriers, clearly outlining the terms, including any waiting periods, allowing you to choose the one that best aligns with your need for immediate or eventual coverage.

Cost vs. Coverage: Is the 999 Plan Good Value?

The $9.95 per month per unit price point is the main attraction of the Colonial Penn 999 plan. It sounds affordable, and for one unit, it is. But assessing the true value requires looking at the cost relative to the amount of coverage you actually receive.

Let’s consider the cost per $1,000 of coverage:

• Example 1: A 60-year-old male might get $1,477 in coverage for one $9.95 unit. To get roughly $10,000 in coverage, he’d need about 7 units (7 * $1,477 = $10,339). The cost would be 7 * $9.95 = $69.65 per month. The cost per $1,000 of coverage is approximately ($69.65 / 10.339) * 1000 = $6.74 per thousand per month.
• Example 2: A 75-year-old female might get $689 in coverage for one $9.95 unit. To get roughly $5,000 in coverage, she’d need about 7 units (7 * $689 = $4,823). The cost would be 7 * $9.95 = $69.65 per month. The cost per $1,000 of coverage is approximately ($69.65 / 4.823) * 1000 = $14.44 per thousand per month.

(Note: These coverage amounts are illustrative examples based on publicly available information and can vary significantly. Always refer to Colonial Penn’s official quote for your specific age, gender, and state.)

When you calculate the cost per $1,000, especially for older applicants, the Colonial Penn 999 plan can often be significantly more expensive than other life insurance options, particularly if you are relatively healthy.

Consider these points:

• Health Matters: If you are in good or even average health, you may qualify for simplified issue or fully underwritten policies that offer much higher coverage amounts for similar or lower premiums than the 999 plan, often without a graded death benefit.
• Coverage Needs: The relatively low maximum coverage amounts available through the 999 plan might not be sufficient for everyone’s needs, even just for final expenses, which can easily exceed $10,000-$15,000.
• The Value of Comparison: Without comparing quotes, you won’t know if you’re overpaying for the coverage you’re getting. The convenience of guaranteed acceptance comes at a price, and it’s worth exploring if you can secure a better deal elsewhere.

This is where Insurance By Heroes provides immense value. As an independent agency, we aren’t tied to any single company like Colonial Penn. We work with dozens of carriers, allowing us to shop the market on your behalf. We can present you with options – guaranteed acceptance, simplified issue, term life, fully underwritten whole life – comparing costs, coverage amounts, and features like graded benefits side-by-side. Our goal is to find you the most coverage for your budget from a reputable carrier, tailored to your health profile and financial goals.

Who Might Consider the Colonial Penn 999 Plan?

Despite its limitations, the Colonial Penn 999 plan serves a purpose for a specific segment of the population. It might be considered by:

• Individuals with Serious Health Issues: People who have been declined for other types of life insurance due to significant health problems might find guaranteed acceptance policies like the 999 plan their only option for securing some coverage.
• Seniors Seeking Small Amounts of Coverage: Those who only want a very small policy (perhaps just $2,000-$5,000) specifically for burial costs or very small debts, and who prioritize guaranteed acceptance over cost or immediate full benefits.
• People Prioritizing Application Simplicity: Individuals who strongly prefer to avoid medical exams and health questionnaires might be drawn to the ease of the guaranteed acceptance application process.

However, even for individuals in these groups, it’s still highly recommended to explore alternatives. Other guaranteed acceptance policies exist from different carriers, and their unit values, costs, or graded benefit details might be more favorable. Furthermore, some “simplified issue” policies ask only a few health questions and might still approve individuals with certain managed health conditions, often providing better value and immediate benefits.

It’s easy to default to a heavily advertised option, but taking a little time to compare can make a big difference. Insurance By Heroes can help individuals, even those with health concerns, explore the full range of possibilities. We understand the nuances of different policies and can help determine if guaranteed acceptance is truly necessary or if a more advantageous option is available.

Potential Drawbacks and Why Alternatives Matter

While the Colonial Penn 999 plan offers a simple application process and guaranteed acceptance, it’s essential to be aware of its potential downsides:

• Graded Death Benefit: The two-year waiting period for the full payout on non-accidental deaths is a significant limitation for those needing immediate final expense coverage.
• Low Coverage Amounts Per Unit: Especially for older applicants, the amount of insurance purchased for $9.95 per month can be very small.
• Potentially High Cost Per $1,000 of Coverage: When compared to other policies, especially if you are relatively healthy, the 999 plan can be an expensive way to buy life insurance.
• Limited Maximum Coverage: The total amount of insurance available is often capped at a relatively low level (e.g., $15,000 – $25,000), which may not cover all final expenses and outstanding debts.
• Unit System Complexity: Understanding how much coverage you are actually getting for your money requires careful calculation based on age, gender, and units purchased, making direct comparisons harder.

These drawbacks highlight why looking beyond a single company and a single product is crucial. The life insurance market is vast, with numerous carriers offering different products designed for various needs and health profiles.

Alternatives to consider exploring include:

• Other Guaranteed Issue Policies: Companies like AIG, Gerber Life, and Mutual of Omaha also offer guaranteed acceptance policies. Comparing their coverage amounts per dollar, graded benefit terms, and maximum issue amounts is wise.
• Simplified Issue Whole Life: These policies require answering some health questions but typically don’t require a medical exam. If you can qualify (even with some common, managed health conditions), they often offer significantly better rates and immediate full coverage compared to guaranteed issue plans.
• Term Life Insurance: If your primary need is coverage for a specific period (like until a mortgage is paid off or children are independent), term life insurance offers much higher death benefits for lower premiums. While typically requiring some health underwriting, options exist even for seniors.
• Final Expense Insurance (Specifically): Many companies offer policies explicitly marketed as “final expense” or “burial insurance.” These are typically smaller whole life policies ($5,000 – $50,000) that may be simplified issue or guaranteed issue, designed specifically to cover end-of-life costs.

Navigating these alternatives can feel overwhelming. That’s the advantage of working with an independent agency like Insurance By Heroes. We do the comparison shopping for you, explaining the pros and cons of each option based on *your* specific situation, not based on selling a single company’s product.

Why Compare Life Insurance Options with Insurance By Heroes?

Choosing life insurance is a significant financial decision. While advertisements for plans like the Colonial Penn 999 offer simplicity, they don’t offer comparison. Relying on a single quote from one company means you might be missing out on better coverage, lower premiums, or policies better suited to your needs.

Insurance By Heroes was founded on principles of service and trust, inspired by the founder’s background as a first responder and military spouse. Our team comprises professionals, many with similar public service experience, who are dedicated to serving our clients’ best interests. We operate as an independent agency, which means:

• We Work For You, Not an Insurance Company: Our loyalty is to you, our client. We aren’t obligated to promote any specific carrier’s products.
• Access to Dozens of Top Carriers: We have established relationships with numerous highly-rated insurance companies across the nation. This allows us to gather quotes for various types of policies (term, whole, universal, final expense, guaranteed issue, simplified issue) from multiple sources.
• Personalized Comparisons: We take the time to understand your unique needs, budget, health situation, and goals. We then search the market to find policies that align with your requirements, presenting you with clear, easy-to-understand comparisons.
• Tailored Coverage: We help you find not just *any* policy, but the *right* policy. Whether you need a small final expense plan without a waiting period, a large term policy for income replacement, or something in between, we can identify suitable options.
• Expert Guidance: We explain the fine print, including details like graded death benefits, policy exclusions, and cash value accumulation, ensuring you fully understand what you are purchasing.
• No Obligation Quotes: We provide quotes and consultations free of charge, allowing you to explore your options without pressure.

While the Colonial Penn 999 plan might seem like an easy solution, especially for those concerned about health issues, it’s often not the most cost-effective or comprehensive option available. By comparing quotes through Insurance By Heroes, you gain access to a broader market, potentially finding policies with immediate benefits, higher coverage limits, and lower costs per thousand dollars of insurance.

Understanding Your Actual Life Insurance Needs

Before settling on any policy, including the Colonial Penn 999 plan, take a moment to assess what you actually need life insurance to cover. Consider:

• Final Expenses: Funeral and burial costs can range from $8,000 to $15,000 or more. Factor in costs for cremation or burial, memorial services, headstones, etc.
• Medical Bills: End-of-life care can result in significant outstanding medical bills.
• Debts: Do you have a mortgage, car loan, credit card debt, or personal loans that would need to be paid off?
• Income Replacement: If you have dependents who rely on your income, how much would they need to maintain their standard of living? (This usually requires larger term or permanent policies, not typically covered by small guaranteed issue plans).
• Leaving a Legacy: Do you wish to leave an inheritance for children, grandchildren, or a charity?

Calculating these needs will give you a target coverage amount. Then, you can compare how different policies, including the Colonial Penn 999 plan (calculating total coverage based on units) and quotes obtained through Insurance By Heroes, stack up against that target and your budget.

The Insurance By Heroes Commitment

At Insurance By Heroes, we believe everyone deserves access to affordable, reliable life insurance that truly meets their needs. Our foundation in public service shapes our commitment to integrity, transparency, and client advocacy. We understand the unique concerns and needs of families, including those of first responders, military members, veterans, and seniors.

We know that navigating insurance options like the Colonial Penn 999 plan can be confusing. Our mission is to simplify the process, provide clear, unbiased information, and empower you to make the best decision for your family’s financial security. We compare the offerings of numerous carriers to find solutions that provide genuine value and peace of mind, ensuring you understand the benefits and limitations of any policy before you commit.

Conclusion: Is the Colonial Penn 999 Plan Right for You?

The Colonial Penn 999 plan offers guaranteed acceptance life insurance with a simple $9.95 per unit monthly premium. Its main advantages are the guaranteed approval within the age range (typically 50-85) and the absence of medical exams or health questions. However, potential buyers must be aware of the significant drawbacks: the two-year graded death benefit for non-accidental death, the potentially low amount of coverage provided per unit (especially for older buyers), and the often high cost per $1,000 of insurance compared to other available options.

While it might be a viable choice for individuals with severe health conditions who cannot qualify elsewhere, most people, even seniors or those with some health issues, can often find better value by exploring the broader market. Policies with immediate full death benefits, higher coverage amounts, and lower premiums may be available through simplified issue or even other guaranteed issue carriers.

Don’t settle for the first or most heavily advertised option without knowing what else is out there. Take control of your life insurance decision by exploring all your choices.

Ready to compare your options and find the best life insurance fit for your needs and budget? Let the experienced team at Insurance By Heroes help. As an independent agency founded by service-minded professionals, we shop dozens of top carriers to find you tailored, affordable coverage. Get personalized, no-obligation quotes today. Fill out the quote request form on this page to get started!