Variable Insurance Ironies

After reading finance master blogger Fitz Villafuerte’s post on getting life insurance, I finally decided to do the most dreadful thing I have not yet done in over one year: read the very fine print of my variable insurance policy with Sunlife. The terms are the humblest possible for a working girl, and it had very minimal coverage in case I die.Some people do not believe in the concept of life insurance, but I kind of feel more at peace with the idea that my family will have enough cash with which to bury me and get by for a few months in case I leave this earth. (Oh, that reminds me, I need a funeral plan in addition to that thing I signed up for! It’s much better to have it all prepared already.)

I almost fell asleep by the time I reached page 5, but I am happy that I read it this time around. I know. It’s idiotic to sign something without reading it first, but I did just that last year. Not my proudest moment there. And two months after that, the fiance applied for what seems to me as a more adaptable and favorable life insurance for himself. I drooled with envy and resigned acceptance that his insurance policy is much better than mine.

Ironically, I found certain interesting provisions that I did not give much thought to when I was signing this VUL application with the animated excitement of a person who is making one of her first few major adult decisions in the year 2012. It was January of last year when I decided to go for the life insurance and investment package that they had which requires me to pay Sun Life quarterly. It’s been a year and it’s been a good year for that policy I opened up.

Just that, I found it interesting that the life insurance in case of death, dismemberment, or accident did not include coverage for death by homicide or suicide. I know suicide is understandably self-inflicted. But I find it very weird that the beneficiaries of a homicide victim cannot claim for benefits even if he or she is a good payer. I mean, if someone kills me, it’s not my fault that I got frigging killed, right? Why should I not be compensated in the event of my death?

So it goes to show that if some random dude decided to end my life for any reason, my family won’t be able to get this thing which I pay four times a year for. πŸ™

Another interesting issue came up when I saw that the insurance policy I am paying for apparently also does not cover for death caused by “insurrection or activities of the armed forces.” Given the very remote but very present possibility of a world war breaking out of a nearby country, I did not feel so comforted that if I get accidentally hit by military activity or exercises, my beneficiaries and I won’t be able claim for benefits.

I wish I talked to my agent more before I signed it. But it’s not all bad, you see…

On the up side, the fund value on the investment portion is double the expectations set by the financial projections on my proposal sheet last year. πŸ™‚

Despite some finance gurus’ assertion that Sun Life VUL and other variable life insurance policies are second-tier forms of investments, I still think that there are favorable returns considering how little I monitor movements in the stock market. I am just satisfied with the fund values, although I am quite (QUITE!) disappointed that I am not insured in case a war breaks out and I die or if some lunatic just accosts me on the street and decides to end the flow of blood pulsating in my veins.Β 

It’s nothing beyond the usual woes of the proletarian worker, IMHO. πŸ™‚ Oh well, I guess I am not as insured as I thought. That tiny bubble of my being that somehow manages to convince me that there are contingencies to look forward to in case of unfavorable circumstances just got poked by the giant needle of reading the fine print of my Sunlife VUL policy.

But the silver lining to the cloud is the fund value, which has grown a lot and I can still recommend that if not for the insurance provisions I mentioned above. Given that it more than doubled my initial investment money, I think it’s still worth recommending despite the non-friendliness to homicide victims or casualties of war.





4 thoughts on “Variable Insurance Ironies

  1. My friend is also insured under Sunlife. I wonder if she read the fine prints. Good point you got here but rather wish for insurance maturity than death claim.

  2. before, i don’t entertain the idea of life insurances and funeral plans but now that i’m working, and knowing that I’m not getting any younger, I am now working to get both.

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