Pre-need sales drop 27% in Q1

Mirroring poor consumer confidence, total sales of the country’s pre-need companies declined by 27 percent in the first quarter this year to P3.84 billion from P5.26 billion in the same period a year ago.

Data prepared by the Securities and Exchange Commission’s Non-Traditional Securities Department showed that the number of plans sold likewise went down 4.2 percent to 52,671 from 54,994.

In March alone, sales reached P1.3 billion or 24.43 percent lower than the P1.73 billion recorded in the same month last year. The total number of units sold, however, increased 21 percent to 18,324 compared with 15,086 a year earlier.

Sales of educations plans showed the biggest drop of 58.31 percent to P465.02 million from P1.11 billion in 2007. A total of 2,694 units were sold or a 67.07 percent drop from the previous level’s 8,180.

Pension plan sales also fell 36.08 percent to P2.03 billion from the previous year’s P3.175 billion as the number of plans sold decreased 40.78 percent to 13,413.

On the other hand, sales of life plans grew 38.09 percent to P1.34 billion as the number of units sold rose 51.3 percent to 36,564.

Initial collections, the first payment made by the planholder upon purchase of a plan depending on his or her mode of payment, amounted to P374.26 million, down 41.5 percent from P640.07 million.

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 and includes life, pension, education and interment.