I was 20 years old when I first got my life insurance policy, it was a VUL plan from Sun Life Financial called Sun Maxilink Prime. VUL, also known as variable unit-linked, is a type of insurance where a part of your premium or payment goes directly to mutual funds. Thus, the policyholder gains a fund known as cash values that grow over time. This is why VUL is also referred to as an insurance policy with investments.
But why get VUL when there other types of life insurance that are more affordable like term and whole? Well, that is what we’re going to discusses today.
Here are five of the best benefits one can get from VUL, and why you might want to consider getting one:
#1 – SAVINGS + PROTECTION
VUL is a two-in-one product, offering the best of both worlds. Aside from its life coverage, there’s also a savings component that goes directly into investment and grows over time. The policyholder can then use this money for his or her financial needs in the future. In my case, I’m saving my cash values so I can use it for my retirement fund.
#2 – FLEXIBLE FEATURES
One thing I love about VUL is that it has flexible payment options. You can choose a package that can fit your budget. It has the idea that the longer and earlier you start on your VUL policy, the smaller you will need to pay for its terms.
Let’s use my case in example, I got my policy when I was 20 years old and only needs to pay Php 1500 per month. My mother, on the other hand, got her when she was 54 and had to pay Php 5000 per month.
#3 – LIQUIDITY
Another great thing about VUL is that it allows its policyholders to make partial withdrawals in case of emergencies, as long as the plan has already earned some funds. However, one must be reminded that the longer the money stay invested in your policy, the more its funds can grow.
#4 – VARIOUS FUNDS
Each people have a different appetite risk. Since VUL has an investment part, it allows the policyholders to make a choice on where they should invest their money. There are various funds that can meet each client’s appetite risk like bond, balanced, equity, money market, index, growth, and many more.
#5 – EXTRA PROTECTION
Last but not least, VUL allows policyholders to attach or add additional benefits to their plan. These optional benefits are designed to address emergencies in case of unexpected events like critical illness, disability, or accident. This gives policyholders added protection aside from its life coverage, which they can use while they are still alive.
So what do you think about VUL? Got more questions about how it works and what are its other benefits? Then feel free to leave a comment below, and will make sure to answer your questions.
Hi! I’m Erika Yap Celario, a millennial frugalist, who’s here to help and join you on your journey to financial freedom. I’m also a proud Financial Advisor and Licensed Insurance Agent of Sun Life. For questions or concerns, you can email me at email@example.com or call me at 09194872581.