Colonial Life Insurance offers group life insurance plans as well as employee benefits insurance that is deducted directly from employee paychecks. Colonial Life Insurance services over 90,000 companies in all 50 states, making them one of the largest employee benefit insurance providers in the U.S. For workers looking for the benefits of term or whole life insurance with pre-tax premiums, Colonial is a solid option.
- Pros & Cons
- Key Takeaways
Premiums paid directly from paychecks using pre-tax dollars
Multiple types of supplement insurance available
Basic life coverage costs may be covered by employer completely
Limited to term and whole life policies only
Coverage terms and amounts may vary by employer
Cannot process claims over the phone
- Colonial Life Insurance offers group life insurance coverage through employers.
- It is licensed to sell insurance in all 50 states.
- Insurance coverage is offered in over 90,000 businesses within the U.S.
- Colonial Life Insurance is a subsidiary of Unum, a large international insurance company.
Colonial Life Insurance is an employee benefits insurance company that focuses on providing life and supplemental insurance. We researched Colonial’s financial stability, policy plan options, riders, website tools, and customer service reviews to help you compare the life insurance policy options of Colonial with the competition.
Colonial Life Insurance was founded in 1937 as Mutual Accident Insurance, providing accidental death benefit coverage to employees. It has since grown into one of the largest voluntary benefits organizations in the U.S. and is now a subsidiary of Unum, a large supplemental insurance company that offers employee benefits coverage for a range of insurance types.
Colonial Life Insurance offers term and life insurance to employees as an elective benefit, with premiums paid directly through employer payroll as a paycheck deduction.
Colonial Life Insurance coverage does not end when the employee leaves, but offers a continuation of coverage option. This allows employees to keep their coverage as they change jobs.
Colonial Life Insurance offers two types of life insurance: term and whole life. These policies can be customized to employees, with varying coverage amounts and optional policies determined by the employer.
Term Life Insurance
Colonial Life Insurance’s term life insurance coverage is available with term lengths that range from 10 to 30 years in length, in 10-year increments. Exact coverage term lengths, total coverage amounts, and premiums are selected by employers. Colonial Life Insurance offers a level-term policy, meaning premiums will stay the same for the duration of the term. To qualify for a term policy, employees may need to answer health-related questions or be subject to a medical exam.
Colonial Life also allows most term policies to be increased in the middle of the term but additional health questions need to be answered before increasing coverage. No medical exam is required to increase existing coverage. Premiums will increase if additional coverage is elected.
Whole Life Insurance
Colonial also offers whole life policies, which is a type of permanent life insurance that covers the insured for their entire life and issues a payout upon their death as long as premiums are paid. These policies also build cash value that can be borrowed against or withdrawn, depending on the options selected.
Colonial Life Insurance offers two whole life options, a “Paid-Up at Age 70” or a “Paid-Up at Age 100” plan. The only difference between these plans is the coverage ending age, which is either age 70 or age 100.
Quotes for the whole life policies are not available online but can be obtained through your employer benefits department.
While Colonial Life Insurance offers riders to its life insurance policies, information about the riders and costs are not available online. Customers may need to speak with their employee benefits department for more details about policy riders or contact Colonial Life Insurance directly.
Here are a few standard riders that are available from most life insurance companies:
Disability Waiver of Premium Rider
If you become permanently disabled, the Disability Waiver of Premium rider waives all premium payments as long as the insured is disabled and unable to pay premiums. The qualifications and terms typically vary by policy.
Terminal Illness Rider
With the Terminal Illness Rider, policyholders who are diagnosed with a terminal illness with a life expectancy of 12 months (or less) may be able to access a portion (or all) of their death benefit on the life insurance policy.
Additional Insurance Products Offered by Colonial Life
Outside of life insurance, Colonial Life Insurance also offers other supplemental insurance products to employees:
This coverage pays out a lump sum amount if the insured is diagnosed with a critical illness (check with your employer benefits department for a list of covered illnesses). This helps clients focus on recovery and offsets the cost of missed work and other income.
Cancer insurance can help offset medical costs and out-of-pocket expenses from a cancer diagnosis. This coverage also helps cover the cancer screening tests to help monitor a client’s health after recovery.
Offered as a supplemental coverage option, its dental coverage helps cover the cost of procedures not covered by a traditional health insurance plan.
Colonial Life Insurance offers both long and short-term disability coverage to replace a portion of the insured’s income when disabled. This coverage can be customized by employers to their specific workforce.
This policy offers extra coverage to help pay for hospital procedures and stays that are not fully covered by traditional medical insurance.
Customer Service: Basic Support
Colonial Life Insurance offers support over the phone, online, standard mail, fax, or via social media. As an employee benefit, many customer service questions will be directed to your workplace benefits department.
Colonial Life Insurance customer service is available by phone from Monday through Friday, 8:00 a.m.–8:00 p.m. ET by calling 1-800-325-4368. They also handle basic customer service questions via Twitter.
Customer Satisfaction: Better Than Average
Colonial Life Insurance receives fewer complaints than average life insurance companies, according to the NAIC Complaint Index. While an average complaint score is 1.0 (the lower, the better), Colonial received a 0.55 score. It has improved over their 2019 score of 0.62, which is still a solid score.
Colonial (or their parent company Unum) was not included in the 2020 J.D. Power Life Insurance Study.
Financial Strength: A (Excellent)
Colonial is a subsidiary of Unum, which has an A (Excellent) rating from AM Best. This reflects a strong financial position and gives customers the assurance that their life insurance claims will be covered and paid by Colonial Life Insurance.
Cancellation Policy: Depends on Employer Policy
Most U.S. states require a minimum “free-look” period for insurance policies, and Colonial Life Insurance is held to this same standard. This is usually a 10-day period that allows clients to sign up for a policy and cancel to receive a full refund.
Since Colonial offers group life insurance policies directly through employers, the actual cancellation policy may depend on your state and employer.
After the free look period, term life insurance policies can typically be canceled, but will not offer a refund of premiums. Whole life policies, on the other hand, may have a surrender value available to customers. Check with your employee benefits department for exact details on Colonial Life Insurance cancellation policies.
Price of Colonial Life Insurance: Varies By Employer
Colonial Life Insurance quotes are not available online, and premiums may be partially covered by your employer. Prices vary by policy, coverage, and term lengths selected as well as employer-negotiated pricing.
How Colonial Life Insurance Compares to Other Life Insurance
Colonial Life Insurance is one of the largest employee benefits life insurance companies in the U.S., offering more than just life insurance. All of its policies are available as paycheck deductions and premiums are paid with pre-tax dollars.
Its term and whole life policies are standard offerings, while prices and coverage vary by employer. Here’s how Colonial Life Insurance compares to another well-known workplace insurance company.
Colonial Life Insurance vs. MetLife Life Insurance
Colonial and MetLife are both top group-life insurance providers for workplaces around the US. They both offer term life policies, as well as other employee perks and programs. While Colonial supports over 90,000 businesses in the U.S., MetLife is by far the larger company, with over 90 million customers in more than 60 countries around the globe.
Here’s how Colonial and MetLife compare:
- MetLife offers universal life policies while Colonial does not.
- Colonial offers several types of supplemental insurance.
- MetLife offers additional perks as part of its plans, including funeral planning and grief counseling.
- Colonial offers a whole life policy, while MetLife does not.
Colonial gives a wider range of insurance coverage options, while MetLife offers the ability to invest your cash value with their universal life policies.
Read our full MetLife Life Insurance review.
|Colonial Life Insurance||MetLife Life Insurance|
|Market Share||Sixth-largest in the U.S. by in-force premiums (UNUM, parent company)||Largest in the U.S. by in-force premiums|
|Number of Plans||2||5|
|Online Quotes Available?||No||No|
|Service Method||Email, phone, social media||Email, phone, social media|
|AM Best Rating||A (Excellent)||A+ (Superior)|
|Complaints Index||0.55 (very good)||1.00 (average)|
Colonial Life Insurance is one of the largest group life insurance companies, with term and whole life plans offered as an employee benefit. While pricing may be partially covered by employers, premiums paid by employees are also tax-deductible, coming directly out of your paycheck.
Colonial Life Insurance’s policies are standard offerings and fit most needs. The company receives very few customer complaints relative to its size and has strong financial backing in its parent company, Unum.
If you are looking for a simple way to get life insurance coverage from your employer, Colonial Life Insurance is a solid option. If you want more coverage options and flexibility, you may want to find another life insurance policy outside of your workplace.
All of our reviews of life insurance companies are based on extensive research and analysis of each company based on offerings, customer service, financial stability, cost, and more. For each company, we compared the life insurance products offered, as well as available features, and reported customer experiences. Visit our life insurance review methodology for the full breakdown of what we evaluated for over two dozen companies.