Variable Universal Life or VUL Insurance

by - Tuesday, October 04, 2016

I'm a licensed Insurance Agent from PRULIFE UK and the product that I offer to my clients is VUL. Saving and investing while being insured, this is how VUL works. Hitting 3 birds in one stone. Life insurance has evolved to address the needs of dying too young and living too long. Because we need money in both cases right?

Variable Universal Life Insurance or simply VUL is a form insurance that offers both insurance benefit and fund accumulation feature. The policy is linked to different assets such as stocks and bonds. It has earning potential that you do not get from a traditional policy. 

While BTID (Buy Term, Invest the Difference) is preferred by many "financial experts" because it is cheaper, VUL has some good points worth considering.


1. We are forced to save - Admit it or not, we are prone to spending rather than saving. 
 And the best way to force ourselves to save is through investing in VUL. One way to consistently save is to automate it. VUL is a form of automation because a portion of your premium is being invested in your chosen fund. Yes, you can save through Mutual Funds and UITF, you can invest for as low as P5000 but those will not force you to save regularly. VUL makes your saving habitual and consistent or else it will lapse. Bear in mind that getting a VUL is a long-term commitment. You have to make sure that you can pay for the premiums for a long period of time. 

2. We can use insurance for Estate Planning - Estate planning is very complicated and until now I'm still confuse about this topic. But here's a thing, a VUL policy is often the best fit for liquidity. Proceeds are commonly paid in six weeks or more. You should be looking at Life Insurance to protect your hard earned estate. Because the government can sequester your property if the heirs will not pay the estate tax.

3. If you have no idea about investing, VUL is right for you - Just like UITF and mutual funds, VUL insurance is handled by professional fund managers. The only difference is the insurance component. Of course, not everyone knows how to invest their money on their own so it is best to entrust it to financial experts. Always remember, you don't touch what you don't know. 

How many times have we been tempted to buy things that we don't need just because money is readily available in our wallet or atm? Like in my case, I'm not the type of person who buy things at will. I have always been frugal and kuripot. I save for emergencies but there are times that I buy things on impulse, buy abubots that I don't really need. But now that I have 2 VUL plans, I know where my money is going. It is safe and earning while I sleep. Believe me, the feeling of being financially free is priceless.

It is always best to seek financial advice from the experts but at the end of the day, it's your financial goal that determines which product is best suited for you. We at Prulife UK adhere to the words "Always listening, always understanding" and we can customize a plan according to your budget. Send me a message if you want a free insurance quote.

Always remember: It's not about how much money you make, It's how you save it!

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