Sales of pre-need firms shoot up to P19.9-B in first semester

Higher prices of pre-need plans boosted sales of the pre-need industry to P19.99 billion in the first half of the year even though the number of plans sold dropped by 13 percent as the public has become more cautious in considering pre-need plans as an investment alternative.

Data culled by the Securities and Exchange Commission’s Non-Traditional Securities and Instrument Department showed a P270-million increase in the total sales of over 40 pre-need companies registered with the SEC.

A total of 311, 977 plans were sold by the pre-need industry in the period January to June this year compared with 359,172 plans the previous year.

SEC attributed the drop in the number of pre-need plans sold to the higher selling price of the plans. Emilio B. Aquino, head of the SEC’s NSID, said a number of pre-need companies applied for price increase this year to boost sales and comply with trust fund requirements.

For its initial collection during the period under review, the industry reported a 2.58 percent decline from P680.11 million to P662.53 million.

Pension plans accounted for 57.6 percent of the total number of plans sold during the first half this year with a contract value of P12.14 billion or a total of 179,705 plans.

On the other hand, the number of education plans sold in the first semester of 2002 fell 19.51 percent to 99,306 from 123,379 a year earlier as pension plans are fast gaining popularity because of the changing lifestyles of Filipinos.

The pension plan is very popular among overseas contract workers (OCWs) who want to insure that they have some savings to use when they come home for good and retire in the Philippines.

The value of education plans sold during the first half this year amounted to P6.9 billion or a decrease of 13.64 percent from the P7.99 billion recorded a year ago. The Sobrepeña-controlled College Assurance Plans Philippines Inc. accounted for 40 percent of the total education plans sold with 39,992 plans valued at P1.21 billion.

Completing the top list were Philam Plans with 11,512 million education plans sold, Berkley (9,452), Prudentialife (9,427), Loyola Education (8,905), Pacific (7,266), Platinum Plans (2,194); Ayala Plans, Inc. (1,932), Himalayang Pilipino Plans Inc. (1,352), and TPG Corp. (1,301).

Life plans, on the other hand, accounted for 10.57 percent of the aggregate plans sold with 32,966 units valued at P949.11 million.

Pre-need firms said sales could be soft in the second half of the year as people are expected to spend more on material things, especially during the Christmas holidays. – Zinnia dela Peña