Pre-need sales plunge 21% in Jan-April

The country’s pre-need industry suffered a 21.08-percent decline in sales in the first four months of the year, still hobbled by shaken confidence among buyers that has lingered over the past five years, as well as tight competition from other safer investment products.

Based on a report prepared by the Securities and Exchange Commission’s Non-Traditional Securities Department, total pre-need plan sales reached P5.14 billion in January to April this year from P6.51 billion in the same period a year ago.

The number of pre-need plans sold, however, increased 3.48 percent to 71,631 from 69,221 with pension plans accounting for bulk of sales.

Sales of pension plans fell 61.19 percent to P2.71 billion from P3.98 billion while sales of life plans grew 45.1 percent to P1.83 billion from P1.26 billion.

Sales of education plans likewise dropped 53.09 percent to P592.27 million from P1.26 billion.

Initial collections, the first payment made by the planholder upon purchase of a plan depending on his or her mode of payment, amounted to P509.04 million, down 36.86 percent from P806.2 million a year earlier.

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.