Sales of pre-need firms down 24% in 1st 8 mos

Sales of pre-need companies dropped by 23.72 percent in the first eight months of the year, mirroring low investor confidence and the slowdown in the economy.

Data collated by the Securities and Exchange Commission’s non-traditional securities department showed that the value of plans sold during the period January to August this year fell to P21.09 billion from P27.65 billion.

The number of units sold likewise dropped by 19.08 percent to 348,849 from the previous year’s 431,093.

The decline was attributed to the current difficult environment, the unstable foreign-exchange rates, and the uncertainties in the political front.

Pension plans accounted for bulk of the total sales with 173,516 units sold or 28.9 percent lower than the year ago’s 244,002 units. The value of these plans amounted to P10.65 billion, down by 36.6 percent from the year earlier figure of P16.79 billion.

Sales of education plans likewise declined by 12.02 percent to P8.42 billion from P9.57 billion a year ago. This was due to the 31.11 percent drop in the number of education plans sold during the period under review from 143,209 to 98,652.

The number of life plans sold, on the other hand, rose 74.74 percent to 76,681 from only 43,882. The contract price of these plans amounted to P2.02 billion, 57.5 percent higher than the P1.28 billion registered in the comparable period.

Industry leader College Assurance Plans Inc. once again dominated the sales of education plans with a total of 28,005 units sold to the public valued at P1.58 billion. In terms of sales, however, Prudentialife Plans Inc. led the list with sales of P1.715 billion or a total of 16,817 units.

Among issuers of life plans, Prudentialife Plans Inc. led the pack with P498.34 million in sales (16,412 units), followed by St. Peter Life Plans Inc. which sold 15,425 units to the public valued at P273.17 million.

Philam Plans Inc., on the other hand, topped the list of pension plan issuers with sales of P2.68 billion, accounting for 19,090 units sold to the public. Prudentialife came in next with sales of P1.25 billion or a total of 12,220 units sold.

In terms of the number of plans sold, however, Mercantile Care plans sold the most with a total of 27,042 units disposed of. The value of the plans sold amounted to P172.42 million.

For its initial collection this year, the pre-need industry reported a decline of 16.16 percent to P1.93 billion from P2.3 billion the same period in 2002.

Preneed companies are firms issuing plans to provide payment or performance of future services or monetary considerations at the time of actual need. Preneed plans include life, education and pension plans. – Zinnia dela Peña