Pre-need resurges as profit soars to P3.25 billion in Q1

MANILA, Philippines — The pre-need industry saw its net income nearly triple to P3.25 billion in the first quarter even amid a decrease in the number of life plans sold, the Insurance Commission (IC) said.

Latest data from IC showed that net income of the industry reached P3.25 billion from January to March, almost triple the P1.12 billion in profit in the same period last year.

This developed even as the premium income of the sector slightly declined by two percent to P5.61 billion following the 36 percent drop in the total number of plans sold.

In aggregate, the industry sold 166,286 pre-need plans, 36 percent lower than the 258,667 sold in the first quarter of 2023.

The bulk or 99 percent of pre-need plans sold were life plans, which also registered a 36 percent drop from a year ago.

The remaining 213 were pension plans, which improved four percent from the 204 sold the year prior. Education plans, likewise, more than doubled to 23 plans sold.

Further, the IC said that investments in trust funds grew by 6.5 percent to P130.11 billion while pre-need reserves rose by 4.5 percent to P120.07 billion.

As mandated by the pre-need code, pre-need providers keep a reserve to cover benefit payables.

Meanwhile, the IC said the difference between investment in trust funds and pre-need reserves rose by 38 percent to P10.05 billion from P7.26 billion in 2023.

With these, the industry saw its asset base increasing to P152.78 billion while liabilities increased 3.6 percent to P126.4 billion.

Similarly, total net worth went up by 15 percent to P26.38 billion.

Latest pre-need figures covered a total of 17 firms, the same number in 2023. Of the total, 11 are licensed, two are servicing companies and four have pending license applications.

St. Peter Life Plan Inc. sold the most number of pre-need plans at 163,726 with a contract price of P9.5 billion. It recorded the largest net worth of P19.17 billion and earned P3.13 billion as of end-March.

Cosmopolitan Climbs Life Plan Inc. came in second in terms of plans sold at 909 worth P48.33 million.

PhilPlans First Inc. issued 492 plans worth P67.69 million while Diamond Memorial Care Plans Inc. signed off 374 plans valued at P13.49 million.

Five of the 17 firms which disclosed their financial status incurred a net loss in the first quarter.

These are Manulife Financial Plans Inc. (P40.51 million), AMA Plans Inc. (P2.26 million), First Union Plans Inc. (P1.68 million), Mercantile Care Plans Inc. (P430,000) and Freedomlife Plan Corp. (P270,000).

Only PhilPlans sold pension plans in the three-month period, releasing 213 worth P188.53 million.

The industry also sold education plans, via PhilPlans, with 23 valued at P7.04 million as face-to-face learning went back to normal.