Last Updated: October 10th, 2025
The Colonial Penn 995 Plan is a guaranteed acceptance life insurance policy where coverage costs $9.95 per unit, but the actual death benefit each unit provides decreases significantly with age. For example, a 50-year-old might get $2,000 per unit while an 80-year-old gets only $500 per unit, making it more expensive per dollar of coverage for older applicants compared to other guaranteed issue options.
Choosing the right life insurance can feel overwhelming, especially when TV ads make policies sound affordable and straightforward. One option you’ve probably seen advertised is Colonial Penn’s 995 Plan, also known as the “$9.95 plan.” While the low monthly cost sounds appealing, there’s more to this policy than meets the eye.
This article breaks down exactly how the 995 Plan works, what you actually get for $9.95, and whether it’s truly the best option for your needs. We’ll look at the pros and cons, compare it to other guaranteed issue policies, and help you make an informed decision about your final expense coverage.
What is the Colonial Penn $9.95 Plan?
The Colonial Penn $9.95 plan, also known as the “995 Plan,” is a type of guaranteed issue life insurance policy marketed primarily to seniors aged 50 to 85. This final expense plan is unique in its pricing model, advertising a flat rate of $9.95 per unit of coverage. The amount of coverage each unit represents varies significantly based on the policyholder’s age.
How Does the 995 Plan Work?
The 995 Plan is designed to be straightforward and accessible, particularly for those who might not qualify for traditional life insurance due to age or health conditions. Here’s how it works:
- No Medical Exam: One of the most appealing aspects of the 995 Plan is that it requires no medical exam or health questions. This makes it an attractive option for those who may have pre-existing conditions or other health concerns.
- Guaranteed Acceptance: As long as you are within the eligible age range (50-85), you are guaranteed to be accepted into the plan. This can provide peace of mind for seniors who have been denied coverage elsewhere.
- Unit-Based Coverage: The cost of the plan is $9.95 per unit of coverage. The amount of coverage you receive for each unit varies based on your age. Younger policyholders receive more coverage per unit than older applicants.
Coverage Amounts Based on Age
To better understand how much coverage the 995 Plan provides, it’s essential to look at the breakdown of coverage amounts by age. Below is a comparison of Colonial Penn’s rates for a $10,000 guaranteed issue life insurance policy for a male non-smoker, alongside three other more affordable providers:
| Applicant Age | Colonial Penn | Gerber Life | AIG | Great Western |
|---|---|---|---|---|
| 50 | $59.70 | $44.09 | $55.99 | $59.56 |
| 60 | $89.55 | $63.89 | $68.14 | $75.39 |
| 70 | $149.25 | $99.18 | $106.00 | $119.54 |
| 80 | Not available | $247.32 | $206.32 | $227.83 |
As seen in the table, the coverage amount you receive for the $9.95 plan decreases significantly as you age, highlighting the importance of understanding what you’re purchasing.
Pros and Cons of the 995 Plan
Before deciding whether the 995 Plan is right for you, it’s essential to weigh its benefits against its drawbacks.
Pros:
- Easy Application Process: With no medical exams or health questions required, the application process is simple and hassle-free.
- Guaranteed Acceptance: For those within the eligible age range, acceptance is guaranteed, making it a reliable option for seniors.
- Fixed Premiums: The cost of the plan does not increase with age, ensuring that premiums remain affordable and predictable over time.
Cons:
- Limited Coverage Amounts: The amount of coverage provided by each unit is relatively low, particularly for older applicants.
- Higher Cost per Coverage Unit: Compared to other life insurance options, the 995 Plan may offer less value per dollar spent.
- Two-Year Waiting Period: There is a two-year waiting period before the full death benefit is available, which means if the policyholder passes away within this period, the beneficiaries may only receive a limited payout.
- Potential for Misleading Advertising: The marketing of the $9.95 plan can be misleading, giving the impression that $9.95 buys a significant amount of coverage when, in reality, the actual coverage amount varies greatly based on age.
Common Misconceptions About the 995 Plan
One of the biggest misconceptions about the Colonial Penn 995 Plan is that the $9.95 monthly rate provides substantial coverage. As shown earlier, the coverage amount for this price is not a flat rate and varies significantly by age. It’s crucial to understand that the $9.95 rate per unit might not provide the amount of coverage you need, especially if you are older.
Who Should Consider the 995 Plan?
The 995 Plan can be a suitable option for certain individuals, particularly those who:
- Have Health Concerns: If you have pre-existing health conditions that make it difficult to qualify for traditional life insurance, the guaranteed acceptance of the 995 Plan could be beneficial.
- Are Looking for Simple, No-Hassle Coverage: The ease of application and guaranteed acceptance make this plan an attractive option for those seeking straightforward coverage without the complications of medical exams or extensive paperwork.
- Need Minimal Coverage: If you’re seeking a small policy to cover average funeral costs and do not need a large death benefit, the 995 Plan might meet your needs.
It might not be the best option for those who:
- Are in Good Health: If you’re in relatively good health, you might qualify for other life insurance policies that offer more coverage at a lower cost.
- Need Substantial Coverage: Those looking for a more significant death benefit might find that the 995 Plan does not provide adequate coverage, especially as they age.
Comparison with Other Life Insurance Options
When comparing the Colonial Penn 995 Plan with other life insurance options, several factors should be considered:
- Term Life Insurance: Typically offers more coverage at a lower cost but requires a medical exam and is not guaranteed issue.
- Whole Life Insurance: Provides lifelong coverage and builds cash value but is generally more expensive and may require a health exam.
- Final Expense Insurance: Similar to the 995 Plan, final expense insurance is designed to cover end-of-life expenses and typically offers smaller death benefits but may come at a lower cost per unit of coverage.
When comparing the Colonial Penn 995 Plan with other options, consider that there are many no medical exam life insurance policies available that may offer better value, especially if you’re in relatively good health.
Customer Reviews and Experiences
Customer feedback on the Colonial Penn 995 Plan is mixed. Some policyholders appreciate the ease of obtaining coverage and the guaranteed acceptance, while others express dissatisfaction with the low coverage amounts and the two-year waiting period for full benefits.
Many customers also highlight frustration with misleading advertising, which suggests more extensive coverage than what is actually provided for $9.95 per month.
Key Takeaways
- The Colonial Penn 995 Plan offers guaranteed acceptance with no medical exam, but coverage per $9.95 unit decreases significantly with age.
- Younger applicants (50-60) may find better value with traditional policies if they’re in reasonably good health.
- The two-year waiting period means full benefits aren’t available immediately, which is standard for guaranteed issue policies.
- Multiple carriers offer similar guaranteed acceptance coverage, often at lower rates per dollar of coverage.
- The $9.95 advertising can be misleading since most people need multiple units to get adequate coverage.
Ready to compare your options? Our specialists can show you multiple guaranteed acceptance policies side-by-side and help you find the coverage that fits your budget and needs.
Call 800-712-8519 or use our life insurance quoter to get started.
Conclusion
The Colonial Penn 995 Plan provides an accessible option for seniors seeking guaranteed life insurance coverage. Its no medical exam requirement and guaranteed acceptance make it particularly valuable for those with health conditions that might otherwise disqualify them from traditional policies.
That said, it’s important to look beyond the appealing $9.95 price point and understand what you’re actually getting. The coverage amount per unit decreases with age, and you may find better value with other guaranteed issue carriers.
Before making a final decision, take time to compare multiple options. Consider your health status, age, and coverage needs. If you’re in reasonably good health, you might qualify for more affordable traditional policies with higher death benefits.
FAQs about the 995 Plan
What is the maximum coverage available with the 995 Plan?
The maximum coverage amount varies depending on the age and gender of the applicant. It’s essential to get a personalized quote to understand your specific coverage.
How does the two-year waiting period work?
If the insured dies within the first two years of the policy, the beneficiaries typically receive a limited payout, often a refund of premiums paid plus interest, rather than the full death benefit.
Can policyholders increase their coverage after purchasing the plan?
No, the coverage amount is fixed once the policy is purchased. Additional policies may be purchased, subject to the company’s rules and restrictions.
What happens if a policyholder dies within the two-year waiting period?
If a policyholder dies within the two-year waiting period, the beneficiaries usually receive a refund of the premiums paid plus interest, rather than the full death benefit.
Are there better options for someone in good health?
Yes, individuals in good health may find more affordable and comprehensive coverage options through other life insurance policies that require a medical exam and offer higher death benefits.
