Variable Universal Life (VUL): The Billionaire’s Insurance Strategy

Real estate has been quiet, flat, and sluggish lately.
Let’s switch to the world of finance instead.
Because from talking to many people,
I realize most Thais still know very little
about the art of transmuting assets.
So today, let’s talk about the insurance world.
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I believe most people today
pay their insurance premiums in cash.
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But did you know that
millionaires abroad
pay their insurance premiums
with stocks or assets instead of cash?
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So, how is that better
than paying premiums with cash?
Come on, let me tell you.
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We call this Variable Universal Life (VUL) —
the ultimate form of insurance
used by the wealthy and ultra-high-net-worth individuals abroad,
and limited only to AI (Accredited Investors).
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The uniqueness of this insurance
is that it doesn’t require cash payment only.
You can pay premiums with assets —
whether stocks, mutual funds, or bonds —
or other financial assets beyond cash.
These assets are then
translated into the policy’s value.
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For example,
let’s say today you hold 7 stocks
worth a total of USD 10 million.
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You don’t want to sell your shares,
but at the same time,
you want to create high life coverage.
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So, from that USD 10 million,
you take out USD 2 million
and move it into a VUL policy value
to wrap and multiply the life coverage by 10 times.
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That means if something unexpected happens (death),
your family or beneficiaries
will receive USD 20 million.
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The USD 2 million taken from your stocks
doesn’t disappear —
it still exists as the same assets in your stock portfolio,
only now represented as policy value.
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If I hadn’t done the VUL,
when I pass away,
my USD 10 million (330 million baht) in stocks
would simply become inheritance for my family.
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But if I did the VUL,
when I pass away,
I could increase the inheritance value
to USD 20 million (from VUL)
plus USD 8 million in my stock portfolio,
making it USD 28 million (about 920 million baht).
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You can see the difference —
the total inheritance value is almost 3 times higher.
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And because it’s from life insurance,
the VUL benefit is not subject to inheritance tax.
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Meanwhile, the beneficiary
receives the life coverage immediately —
no need to appoint an estate executor
or wait for probate procedures.
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At this point, you might wonder —
what does the insurance company get?
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The insurance company earns management fees
charged from the policy’s asset value.
Typically, a VUL
charges around 0.2% per year
plus the COI (Cost of Insurance) fee.
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Wealthy individuals abroad do this
because some are public company owners
or listed company executives.
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Their stocks
can be used as assets
to back the VUL policy
without selling them.
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Because they believe those stocks
can grow in value
more than the annual cost of VUL itself.
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Join the discussion at
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