Pros and Cons of Variable Life Insurance Policy

Before you decide whether variable life insurance is a wise investment decision, we urge you to consider the pros and cons. This way, you are guaranteed of making informed financial decisions.


  1. You have more control over how you want to invest your cash value. You can decide to invest your cash value on bonds, shares, or mutual funds/
  2. You can use your interest on your sub-accounts to pay for your premium. Let’s say, your premium is $10, 000 per month and you make additional gain of $500 on your cash value. You can use the gain ($500) to reduce the amount of your premium, which would be $9, 500 in this case.
  3. Your sub-accounts are free from tax, thus helping your sub-accounts to grow faster.
  4. You pay fixed premium. As a policy holder, you have nothing to worry about inflation. 
  5. You are guaranteed of getting death benefit even if your sub-accounts are performing poorly.
  6. You can borrow money from your investment component at little or no interest.


  1. It is very expensive and risky. This is because whether you make or loss or gain on your sub-accounts, you have to pay your premium.
  2. It depends on your ability to make prudent investment decisions.
  3. It requires knowledge of investing in stocks, bonds, and mutual funds.