Mutual of Omaha vs Colonial Penn: Which Final Expense Policy Is Right for You?
Two well-known names, two very different ways to buy burial coverage. This guide puts Mutual of Omaha and Colonial Penn side by side with real rate tables, the waiting-period rules that matter, and a simple framework for deciding which one fits you. Jump to the rate comparison, the decision guide, or the FAQ.
The Comparison
Two Different Approaches to Burial Coverage
If you are comparing Mutual of Omaha and Colonial Penn for final expense insurance, you are looking at two very different approaches to burial coverage. They are both legitimate, financially stable companies. They just solve the problem in opposite ways.
Mutual of Omaha uses simplified issue underwriting. You answer a few health questions, there is no medical exam, and most seniors qualify for full coverage starting on day one. Colonial Penn uses guaranteed acceptance. There are no health questions at all, so no one is turned down, but the cost per dollar of coverage is higher and the policy carries a 2-year waiting period.
Part of what makes this comparison confusing is that both companies advertise heavily and both quote a low starting price. Colonial Penn is famous for its $9.95 television offer, and Mutual of Omaha is a household name from decades of sponsorships. Price per unit and price per policy are not the same thing, though, and that is where most shoppers get tripped up. The sections below translate the marketing into the actual monthly cost for a real amount of coverage.
Which one is right depends on your health, your age, and how much coverage you need. I am a licensed insurance agent (NPN #20817039) and I work with Mutual of Omaha directly. I have also researched Colonial Penn's plans extensively. This comparison is based on actual rate data and real underwriting experience, not secondhand summaries. For the deeper single-carrier breakdowns, see our full Mutual of Omaha review and our full Colonial Penn review. If you want the broader background first, start with final expense insurance.
The Bottom Line
Quick Answer: Which Is Better?
If you are in average health: Mutual of Omaha. Lower premiums, no waiting period, and immediate day-one coverage for qualified applicants.
If you have been declined by other carriers: Colonial Penn. Guaranteed acceptance regardless of health, but expect to pay roughly twice as much per dollar of coverage and to wait two years for full natural-death benefits.
Read on for the full rate comparison and the decision framework that shows exactly where each carrier wins.
Head to Head
Side-by-Side Comparison: Mutual of Omaha vs Colonial Penn
Feature Comparison
| Feature | Mutual of Omaha | Colonial Penn |
|---|---|---|
| Underwriting type | Simplified issue (health questions, no exam) | Guaranteed acceptance (no questions, no exam) |
| Issue ages | 45-85 (50-75 in NY) | 50-85 (most states) |
| Coverage range | $2,000-$25,000 | Varies by units purchased |
| Waiting period | None (day-one full coverage for SI) | 2 years for natural death (GI plan) |
| Premiums | Level (locked, never increase) | Level (locked, never increase) |
| AM Best rating | A+ (Superior) | A- (Excellent) |
| BBB rating | A+ | B |
| Medical exam required | No | No |
| How sold | Through independent agents | Direct to consumer (TV/mail/online) |
The biggest practical differences are the waiting period and the premium-to-coverage ratio. Mutual of Omaha pays the full death benefit from day one for qualified applicants. Colonial Penn pays only a return of premiums plus interest if death occurs in the first two years from natural causes. Both carriers lock your premium for life, and neither requires a medical exam, so the real decision comes down to your health and how soon you need full coverage in force.
The Numbers
Rate Comparison: What You Actually Pay
This is the part most comparison articles skip. Below is what $10,000 of coverage actually costs from each carrier, by age, for a non-tobacco woman. Mutual of Omaha figures come from current Asurgo carrier illustrations. Colonial Penn figures are built from published per-unit values and are marked for verification.
Cost for $10,000 Coverage, Female Non-Tobacco
| Age | Mutual of Omaha (SI) | Colonial Penn (GI) | Difference | CP Multiplier |
|---|---|---|---|---|
| 50 | $24/mo | $49.75/mo (5 units) | +$25.75 | 2.1x |
| 60 | $33/mo | $69.65/mo (7 units) | +$36.65 | 2.1x |
| 65 | $41/mo | $79.60/mo (8 units) | +$38.60 | 1.9x |
| 70 | $53/mo | $99.50/mo (10 units) | +$46.50 | 1.9x |
| 75 | $72/mo | $139.30/mo (14 units) | +$67.30 | 1.9x |
| 80 | $98/mo | $149.25/mo (15-unit max, ~$9,120) | coverage capped | n/a |
Here is a concrete example. A 65-year-old woman seeking $10,000 in final expense coverage would pay approximately $79.60 per month with Colonial Penn (8 units at $9.95 each), compared to approximately $41 per month with Mutual of Omaha. That is a difference of about $38.60 every month, or roughly $463 per year, for the same $10,000 benefit.
Notice that the premium multiplier is fairly consistent. Colonial Penn runs from about 1.9 to 2.1 times the Mutual of Omaha premium across the age bands, slightly higher at the youngest ages. At age 80 the comparison breaks down entirely, because Colonial Penn caps at 15 units. That maximum tops out near $9,120 for a woman and cannot reach $10,000 at all, while Mutual of Omaha still writes the full $10,000.
This price difference exists because Colonial Penn accepts everyone, regardless of health. Mutual of Omaha asks a few health questions. If you can answer those questions favorably, which most seniors can even with common conditions like controlled diabetes or high blood pressure, simplified issue is significantly more affordable. You can read how specific conditions are typically handled in our guides on life insurance for diabetics and heart disease. To estimate how much coverage your family actually needs, try our burial cost calculator.
The Long-Term Math
The 10-Year Cost Comparison
Monthly differences are easy to underestimate. Stretched over the life of a policy, they add up fast. Here is the cumulative cost for a 65-year-old woman holding $10,000 of coverage.
| Timeframe | Mutual of Omaha | Colonial Penn | Savings with MoO |
|---|---|---|---|
| Year 1 | $492 | $955 | $463 |
| Year 5 | $2,460 | $4,776 | $2,316 |
| Year 10 | $4,920 | $9,552 | $4,632 |
| Year 15 | $7,380 | $14,328 | $6,948 |
At 8 units ($79.60 per month), a Colonial Penn policyholder reaches the point of paying more in premiums than the $10,000 death benefit after about 10.5 years. A Mutual of Omaha policyholder, at about $41 per month, reaches that break-even point much later, because the premium is roughly half the cost. Over 15 years the gap reaches about $6,900.
Day One vs Year Two
Waiting Period: Why It Matters
The waiting period is the single most important difference for a family that needs protection soon. It decides whether the full benefit is available right away or two years down the road.
Mutual of Omaha (Simplified Issue)
Full death benefit from day one. If the policyholder passes away one month after the policy starts, the full $10,000 is paid to beneficiaries. There is no graded period for applicants who qualify for the Level benefit.
Colonial Penn (Guaranteed Acceptance)
During the first 2 years, if death is from natural causes, beneficiaries receive a return of all premiums paid plus interest (typically 7 to 10 percent compounded annually), not the full benefit. Accidental death is covered from day one. After 2 years, the full benefit applies for any cause of death.
Consider what this means in practice. A 68-year-old man who buys a Colonial Penn policy and passes away from a heart condition 14 months later leaves his family a refund of the premiums he paid plus interest, not the full benefit they were counting on. The same man, if he qualified for Mutual of Omaha's Level plan, would leave his family the entire death benefit. For families using the policy to cover a funeral that could arrive at any time, that distinction is the whole reason to buy coverage in the first place.
The waiting period is the trade-off for guaranteed acceptance. Colonial Penn takes on more risk by accepting everyone, so they protect themselves with the 2-year graded benefit. For most seniors in average health, this trade-off is unnecessary, because simplified issue carriers like Mutual of Omaha will approve them with no waiting period. If avoiding the wait is your priority, our guide to burial insurance with no waiting period explains the day-one options, and guaranteed issue explained covers when a no-questions product is genuinely the right call.
Best Fit
Who Should Choose Mutual of Omaha
- Seniors in average health who can answer a few basic health questions
- Anyone with controlled common conditions, such as diabetes on oral medication, high blood pressure on standard medications, or managed heart conditions
- Seniors who want day-one coverage with no waiting period
- Anyone looking for the lowest premium per dollar of coverage
- Ages 45 to 85 (50 to 75 in New York)
Mutual of Omaha's simplified issue final expense policy, the Living Promise plan, is our most-recommended option for the majority of seniors. We work with Mutual of Omaha directly and can provide exact quotes based on your age and health profile. If you are weighing it against the broader market, our full carrier comparison shows where it lands among the top carriers. Because we are independent, there is no pressure to steer you toward a single product. If a different carrier underwrites your specific health profile better, we will tell you and quote that one instead.
Ready to see your Mutual of Omaha rate?
We quote Mutual of Omaha directly. Most applicants qualify with no medical exam and day-one coverage.
When Guaranteed Acceptance Wins
Who Should Choose Colonial Penn
- Seniors who have been declined by multiple simplified issue carriers due to serious health conditions
- Seniors with conditions that typically disqualify from simplified issue: active cancer treatment, a recent stroke (within 12 months), current dialysis, severe COPD requiring oxygen, or a recent heart attack (within 12 months)
- Seniors who want coverage without answering any health questions at all
- Ages 50 to 85
Colonial Penn serves an important purpose. If you have a serious health condition that prevents you from qualifying anywhere else, guaranteed acceptance coverage is better than no coverage at all. The premiums are higher and there is a 2-year waiting period, but it provides certainty that your final expenses will be covered.
Before choosing Colonial Penn, we recommend checking whether you qualify for simplified issue coverage first. Many seniors assume their health disqualifies them when it does not. Common conditions like Type 2 diabetes, high blood pressure, and even some heart conditions are accepted by simplified issue carriers.
It is also worth knowing that guaranteed acceptance is not unique to Colonial Penn. Several carriers offer a similar no-questions product, and some return more coverage per dollar for the same premium. The honest takeaway is straightforward: guaranteed acceptance should be the floor you land on after checking simplified issue, not the first option you reach for.
Not sure if you would be declined?
We check your eligibility across 25+ carriers first, so you only fall back to guaranteed acceptance if you truly need it.
Beyond These Two
What About Other Carriers?
This comparison is not limited to two names. The right policy for you might come from a carrier neither of these brands advertises on television.
- Aetna (Accendo): accepts some conditions Mutual of Omaha declines, with coverage available through age 89
- AIG: competitive simplified issue rates, plus a guaranteed issue option
- Transamerica: another strong simplified issue option for harder-to-place health profiles
- Gerber Life: a guaranteed acceptance alternative to Colonial Penn that is often cheaper for the same coverage
As an independent broker, Asurgo works with 25+ carriers. If neither Mutual of Omaha nor Colonial Penn is the right fit, we can find the carrier that matches your specific health profile and budget. See our full carrier comparison for the wider field.
Common Questions
Frequently Asked Questions
Is Mutual of Omaha better than Colonial Penn?
For the majority of seniors in average health, yes. Mutual of Omaha offers lower premiums, no waiting period, and an A+ AM Best rating. A 65-year-old woman pays approximately $41 per month for $10,000 from Mutual of Omaha, compared to approximately $79.60 for the same coverage from Colonial Penn. However, if you have serious health conditions that prevent you from qualifying for simplified issue coverage, Colonial Penn's guaranteed acceptance may be your best option.
Does Colonial Penn have a waiting period?
Yes. Colonial Penn's guaranteed acceptance plan has a 2-year waiting period for death from natural causes. During the first two years, beneficiaries receive a return of all premiums paid plus interest rather than the full death benefit. Accidental death is covered from day one. After two years, the full death benefit applies regardless of cause of death.
Does Mutual of Omaha require a medical exam?
No. Mutual of Omaha's simplified issue final expense policy does not require a medical exam. You answer a short set of health questions on the application. Most seniors in average health qualify for immediate, day-one coverage with no waiting period.
How much does Mutual of Omaha final expense cost per month?
For a $10,000 simplified issue policy (female, non-tobacco), Mutual of Omaha costs approximately $24/mo at age 50, $33/mo at age 60, $53/mo at age 70, and $98/mo at age 80. Rates vary by age, gender, tobacco use, and health answers. These rates are for level-benefit coverage with no waiting period.
What is the catch with the Colonial Penn $9.95 plan?
The $9.95 price is for one unit of coverage, not a complete policy. The coverage amount per unit depends on your age and gender. A 65-year-old woman gets approximately $1,258 per unit. To reach $10,000 in coverage, she would need about 8 units at $79.60 per month total. The plan also has a 2-year waiting period for natural death.
Can I get Mutual of Omaha if I have diabetes?
In many cases, yes. Mutual of Omaha's simplified issue application accepts applicants with controlled Type 2 diabetes on oral medication. If your diabetes is managed and you haven't been hospitalized for diabetes-related complications recently, you may qualify for day-one coverage. Each carrier has different underwriting guidelines, which is why comparing multiple carriers through an independent broker is valuable.
Is Colonial Penn guaranteed acceptance?
Yes. Colonial Penn's $9.95 plan accepts all applicants ages 50-85 (in most states) with no health questions and no medical exam. This makes it suitable for seniors who cannot qualify for simplified issue coverage elsewhere. The trade-off is higher premiums per dollar of coverage and a 2-year waiting period.
Which has a better financial rating - Mutual of Omaha or Colonial Penn?
Mutual of Omaha has a higher AM Best rating of A+ (Superior), compared to Colonial Penn's A- (Excellent). Both ratings indicate financial stability, but Mutual of Omaha's is stronger. Mutual of Omaha also holds an A+ BBB rating, while Colonial Penn holds a B rating from the BBB.
Can I switch from Colonial Penn to Mutual of Omaha?
Yes, you can apply for a Mutual of Omaha policy at any time. If approved, you would start a new policy. However, keep your Colonial Penn policy active until your new policy is issued and past any contestability period. Never cancel existing coverage before new coverage is confirmed in writing.
What are alternatives to Colonial Penn for guaranteed acceptance?
If you need guaranteed acceptance (no health questions), alternatives include Gerber Life guaranteed issue and AIG guaranteed issue. These carriers sometimes offer more coverage per dollar than Colonial Penn. However, the best approach is to first check whether you qualify for simplified issue coverage, which provides significantly more coverage at lower cost. An independent broker like Asurgo can check your eligibility across 25+ carriers.
Related Reading
Compare both, then pick with confidence.
Mutual of Omaha is the lower-cost, day-one choice for most seniors in average health. Colonial Penn is the safety net when health rules everything else out. Asurgo quotes Mutual of Omaha directly and shops 25+ carriers, so you can see exactly where you qualify before you decide. Getting a quote takes a few minutes and does not obligate you to buy.
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Nicholas Norminton, Licensed Insurance Specialist
Nicholas is a nationally licensed insurance specialist who has personally helped thousands of clients secure life insurance coverage. He built Asurgo into a trusted, tech-forward brokerage serving clients in 48 states with access to 25+ carriers. He places Mutual of Omaha Living Promise policies regularly and compares carrier products based on firsthand underwriting experience.
Sources
AM Best (financial strength ratings) · Better Business Bureau (BBB ratings) · ColonialPenn.com (plan details, waiting period terms, unit structure). Mutual of Omaha rate figures are from current Asurgo carrier illustrations, 2026.