Money and insurance

How Life Insurance Policy and Investment Works

When it comes to making a solid investment, most people overlook life and health insurance policy as a viable option.

By Mabel Marquez

Many people opt out of insurance because they think it is needless. They're in the pink of health. They're careful enough or overconfident enough to believe that they won't get into an accident. They have a more liquid investment elsewhere.

First of all, many insurance options are available that can address all of your supposed doubts. You can even benefit from insurance without falling sick or (heaven forbid) getting into an accident or (heaven forbid) dying. 

Meet variable unit-linked life insurance plans or VUL plans. As one of the most popular insurance options in the Philippines today, VUL plans are much better than the insurance stereotype. Not only do you enjoy comprehensive financial protection for you and your family, but you also acquire a sound financial investment.


Why should you make a VUL investment?

That investment in life insurance is a waste is one other misconception. Many people ask why they should bother allocating money when they won't be able to use it when they pass away. In a sense, it’s like digging a hole in your backyard and regularly putting money in it for savings. The money may be safe, but it doesn’t grow in value nor can it be easily accessed when need be.

Logically, a better kind of investment would be something people can enjoy conveniently. People prefer assets that grow in value and are easily accessible.

VUL plans are not difficult to understand. Essentially, part of your premiums becomes investments after a specific period. As you continue to pay your premiums, your investment grows. It is a great option to have, especially if you want to build your emergency funds.

If you get VUL plans early in your career, it can also help you prepare for your children’s schooling, your retirement, or even a much-deserved vacation. You simply need to endeavor to keep your policy active by paying your premiums and not exhausting your investment or account value.


Benefits and advantages of insurance investments

The benefit of having a VUL plan is you get to ride on the growth of the market. If the market is good, then your policy earns more account value or your policy’s living benefit that you can take out to fund your financial goals. Remember, however, that VUL earnings are not guaranteed and depend highly on market performance.

In FWD, its VUL plans have expert fund managers who can invest and manage your money for you while providing lifetime coverage so you can go on pursuing your passion with fewer worries.

For many experienced investors, this is a much more lucrative option as opposed to just paying premiums that put your money to sleep, so to speak. With sound financial advice, you can further expand and improve your investment so you can continue accumulating wealth.

If you’re looking for a reliable secondary stream of income in the future, insurance investments could be something worth looking into. Don’t just do the mature thing for your future’s financial security; do the mature and smart thing for you.

FWD Manifest can be what you need. It combines insurance and investment so you are protected while growing your money. Moreover, it also offers bonuses for investing long-term and protects it from risks.