The Best Insurance Company in Terms of Investments

Posted by Fitz Villafuerte under Investing, Personal Finance on August 4, 2014

I was on Facebook the other day, when I saw this question being asked in a group.

Can you please advice me which is the best insurance company in terms of investments? Manulife? Sunlife or Philam? Thanks.

The initial responses where agents and advisors who are sharing why they are the best insurance company, while some gave their opinion and experiences as a client in those companies.

I decided to give a more lengthy response, which I’m reposting below.

I’ve edited it a bit for clarity, and emphasized the most important points. I hope this can help you in your own concerns regarding this issue.

life insurance The Best Insurance Company in Terms of Investments

What’s the best insurance company in terms of investments in the Philippines?

Ask yourself first what your needs are. If you need life insurance, then go to a life insurance company, but if you need an investment, then go to an investment company (and not an insurance company).

If you need life insurance, then get the purest form of life insurance, which is term insurance. It’s the cheapest type of life insurance, which makes it easier to pay.

More importantly, know how much coverage you need and do not simply take an agent’s “guesstimate”. It should cover for your family’s needs in the next few years, including the present value of your children’s education.

If you need an investment, then decide on your financial objectives first.

Why are you investing? Where will the money be used? When will the money be used? It’s wrong to ask what’s the best investment – rather, you should ask what investment can help you achieve your personal goals.

If it’s for your retirement in 20 years time, then go for high-risk investments such as Equity Funds or the stock market. If it’s to buy a car in 5 years, then a moderate-risk investment such as a Balanced Fund might be your best option.

insurance philippines The Best Insurance Company in Terms of Investments

Proper financial planning is a 3-step process: Save > Protect > Grow.

Have the habit of saving first, make sure that you’re living below your means. Second, ensure proper protection with an emergency fund, health insurance and life insurance. And lastly, grow your wealth with investments that can help you achieve your financial goals.

This is a 3-step process that should be done one step at a time – no shortcuts. Which means getting an insurance with investments is not something I would recommend because you’re getting a 2-in-1 product that’s better availed separately.

Did you know that the minimum holding period of a UITF or mutual fund investment ranges from 30 days to a year only? Which means you can redeem those investments anytime after that period – and there’s no pressure to invest more money in case you’re on a tight budget.

Remember, if you fail to pay your insurance premiums, it will get cancelled. But if you fail to top up your investments, nothing happens and your investment will just be there and will continue to grow.

That’s why it’s better to get the cheapest type of life insurance (so makes it easy to pay), and invest directly in UITFs, mutual funds and/or the stock market.

Learn about the concept of BTID – which is “Buy Term, Invest the Difference” – this will help you save a lot of money.

best insurance company The Best Insurance Company in Terms of Investments

You don’t need life insurance until the age of 100 as a form of protection. It is important for estate planning, but that’s assuming your net estate is worth more than P2.5 million, where BIR deductions start to reach its limits (see here for illustrations).

But still in this case, getting term insurance is the best option. And moreover, there are other tools you can use for effective estate planning apart from life insurance.

Lastly, remember that personal finance is personal and it is only you who knows what’s best for you. Ask yourself what exactly your needs are, and then that’s the time you seek products that can meet those needs.

As for the question on Manulife, Sunlife or Philam – I believe that all of them are great companies and all of them have term insurance and mutual funds that can help you achieve your financial goals.

The more important decision is in choosing the right agent or financial advisor – the person who will put your best interest first before their own. Someone who will recommend to you the most appropriate product for your needs, and not the product that will help them reach their sales quota.

Questions regarding my response? Ask them below in the comments section.

If you want to learn more about investing, then please subscribe to Ready To Be Rich.

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Photo credits: alancleaver, dhilowitz and teflon

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14 Responses to “The Best Insurance Company in Terms of Investments”


  1. krissy says:

    hi sir fitz!
    thanks for your valuable insights at the Facebook group Filipino Financial Freedom =) you are indeed a personal finance mentor to follow and learn from =) God bless!

  2. Oneal says:

    So far, the best from sir fitz! This is like a value meal. All the essentials, yet in very simple words. Thanks.

  3. elleica says:

    As always, you were never a fan of variable insurance Fitz and a staunch supporter of term plus mutual fund. I tend to lean over to favoring VUL vs TERM though but your arguments are also sound and facing a situation wherein I am sadly behind my VUL payments, and just managing to pay the minimum so that it doesn’t lapse, I am led to consider rearranging my entire financial plan following the simple concepts you’ve outlined above.

    I agree with you however that people should get financial advisers they could trust vs someone who would just disappear from them after the sale. At the end of the day, they would want someone who will be there to answer their concerns long after the sale has been made.

  4. R. J. says:

    This is why i stick on reading your post. Very true, ideal and no promotion of insurance company intended.

  5. Raymond says:

    I hope I have read this post before I have gotten my VUL hehe. Not that I am regretting, I just hope that I knew more. With my case right now kasi (it’s been 6 years that I had been depositing), it’s kinda late na to study. Anyway, thanks for sharing this Sir Fitz! You’re really my idol. :-)

  6. gen says:

    Added to the insight. That most VUL charges it’s fees on the initial years and later fully invested it on the later part. Hopefully advisors explained this to get more transparent. There are studies about VUL VS BTID comparison. Try searching to get more insights.

  7. Caroline says:

    Question,
    how and where can i find a Financial Advisor?

  8. Janice says:

    Nice article sir Fitz! :)

    I like the concept of “Buy Term, Invest the Difference”. Not only we get the maximum potential of our money but also we lessen or even free ourselves from the expensive admin charges incurred when getting other forms of insurance like VULs. I’m not against insurance. Nanghihinayang lng ako sa sobrang mahal na admin fees na binabayad naten na pwede na sana natin iinvest sa stocks or mutual funds at mas malaki pa ang potential returns.

  9. Ron says:

    How about single pay VUL?

  10. Delia M. Sayson says:

    Single Pay VUL is better for those who needs investment rather than a regular pay investment. A. Financial Advisor should see first what is best to client either Mission to client first or his goal as Financial Advisor.

  11. Joanna Siron says:

    The thing about VUL and Term is that their are VUL products that has limited paying years that covers your insurance throughout your lifetime. When it comes to Term insurance you have to pay for it yearly even in your older years which then makes the premium more expensive. If you are unable to pay for the premium of the VUL the funds that are invested in the stock market every time you pay your premiums will pay for the insurance. Years after, if something happens to the insured, the beneficiaries will get the guaranteed benefit amount/ face amount plus the funds/ investment. I have nothing against Term insurance, maybe that’s just how I see it considering that I am still young and will be needing to pay longer more years and if by that time I cannot afford it anymore will not be able covered anymore. Maybe I am more into security.

  12. Jocelyn M. saulog says:

    It must be Prulife. This company developed the very first investment vehicle in the insurance industry. Ergo the track record is by far stronger than all the other existing investment products in the country. Whoever pioneers gets the edge. Simple as that.

  13. onyxx22 says:

    i am glad i held back on VULs. somebody who was very convincing introduced this product to me and i almost gave in. good thing i was able to research on this subject (online) and talked to other people people before i made my decision. (at that time i wasn’t able to consult this site yet.)

    the gist of their advice was — avoid combining insurance with investments as a single product. if want to buy insurance, then by all means get one, but investments should be treated as investments and not tied down to anything else. this post is a nice validation of that timely advice (i decided to stick with UITFs instead). thanks. (now i feel a bit better.)

  14. Ananimus says:

    didn’t answer the question

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