Maintaining buyer’s trust in pre-need plans

PhilAm Plans Inc. maintains the trust of its 300,000 planholders through its forfeit-free plans which ensures that policy holders and their beneficiaries could still enjoy some benefits from the plans they could no longer pay because of economic emergency and other exigencies.

Oftentimes, discontinuance of payment (due to personal emergencies of the policy holder) results in lapsed or cancelled plans.

“We are in a trust business. How can we get the trust of our plan holders if we forfeit or deny their rights to the premiums they have paid for several years but could no longer continue paying for because of their personal emergencies,” explained Jack Howell, president & CEO of PhilAm Plans.

Under Howell’s watch, PhilAm Plans simplified and shortened its policies making them easy to read and understand. “Potential clients will make decisions on plans that really suit their needs and not what is being pushed to them by the agents,” Howell said.

So from 17 products in 2006, PhilAm Plans now sells only three pensions products (iPlan, Aspire Savings Plan and Vantage, a group pension); one education product (Prodigy) and two life products (Dignity Life and Virtue Life).

PhilAm innovated the forfeit-free feature in its policies — beginning with iPlan which it launched in March this year.

“We have been conducting surveys and asking people what would make them invest in pre-need plans and they always tell us they just want to be able to get their money back in the future in case they could no longer continue paying the annual payments,” Howell said.

We answered a market need so we designed our plans to be forfeit-free. We also simplified the fine prints in the plans so that our buyers will fully appreciate that what they are buying actually suits their needs, Howell added.

Aside from being a financially solid company with trust funds worth P29 billion and a having a parent firm like PhilAmLife, the leading life insurance company and backed up by a global risk manager, the American Insurance Group, PhilAm Plans has what it takes for investors to be confident. Besides, it never sold any open ended product in its entire operational history. Also, its pool of 10,000 associates (or sales agents) are constantly screened and tested by government regulators and by the company itself.

No less than the Securities and Exchange Commission cites PhilAm Plans as the overall leader in the entire pre need industry for January to December 2006 with total pre need plan (PNP) sales of P3.46 billion and a market share of 17.5 percent.

Among PhilAm Plan’s products, pension plans are still the best seller accounting for 80 percent of total sales followed by education and life products with 15.