Pre-need sector suffers 9.5% drop in sales

Mirroring low consumer confidence in light of the uncertain global economy, the country’s pre-need industry suffered a 9.5 percent decline in sales for the first six months of the year, the Securities and Exchange Commission (SEC) reported over the weekend.

The number of plans sold for the first semester decreased to 246,766 from 272,923 in the same period last year, with education and life plans reporting a 14 percent and 26 percent decline, respectively in their sales.

The aggregate contract value of these plans, however, amounted to P18.38 billion or an improvement of 14.71 percent from P16.02 billion the previous level, mainly due to higher prices.

Pension plans accounted for bulk of the total sales, with 133,959 units sold compared with only 133,179 units last year. The aggregate value of these plans amounted to P10.23 billion, up by 30.2 percent from P7.86 billion a year earlier.

The number of education plans sold slid by 14.33 percent to 69,328 from 80,925. The value of their sales, however, slightly increased to P6.75 billion from P6.67 billion.

The number of life plans sold likewise decreased to 43,479, 26 percent lower than the previous year’s 58,819. The value of these sales fell 6.26 percent to P1.41 billion from P1.5 billion.

Philam Plans Inc. emerged as the number one seller of pension plans for the period under review. It sold a total of 20,343 plans valued at P3.24 billion.

On second spot was Comprehensive Annuity Plans & Pension Corp. with sales of P913.42 million equivalent to 17,168 units.

Among issuers of education plans, College Assurance Plans Phils. Inc. was the top seller with a total of 17,417 units sold for an aggregate price of P1.37 billion followed by Philam Plans Phils. Inc. with sales of P1.61 billion, accounting for 11,996 plans.

St. Peter Life Plans, on the other hand, was the number one seller for life plans with 11,886 units sold valued at P220.35 million.

In terms of sales, however, Prudentialife Plans was number one with total sales of P443.21 million, representing 8,781 plans.

The pre-need industry has faced difficult challenges in meeting investment objectives based on the assumptions of expected returns under more favorable economic and market conditions.