Pre-need sales plunge 20.2% in January-November 2008

The local pre-need industry continued its downward slide in the 11-month period to November last year, data from the Securities and Exchange Commission’s Non-Traditional Securities Department showed.

It said total sales of the country’s pre-need companies fell 20.2 percent to P13.97 billion from P17.51 billion a year earlier.

The number of plans sold, however, increased 9.04 percent to 228,170 from 209,251.

Sales of pension plans fell 35 percent to P6.66 billion from P10.28 billion as the number of units sold declined to 61,999 from 91,344.

Education plans suffered the biggest drop in sales from P3.65 billion to P1.66 billion. A total of 9,745 units were sold, 58 percent lower than the year earlier level of 23,293.

Sales of life plans, on the other hand, grew 54.4 percent to P6.5 billion from P3.58 billion as the number of units sold went up 66 percent to 157,226 from only 94,614.

Initial collections, the first payment made by the planholder upon purchase of a plan depending on his or her mode of payment, reached P1.41 billion, down 25 percent from P1.88 billion.

Pre-need plans are contracts which provide for the performance of future services or the payment of future monetary considerations at the time of actual need for which planholders pay in cash or installment at stated prices, with or without interest or insurance coverage.      – Zinnia dela Peña