Philam Plans sets ambitious targets

Philam Plans Inc., the pre-need company of financial giant Philippine American Life and General Insurance Co., is looking to be the first pre-need company to breach the P10-billion mark in terms of pre-need price (PNP) levels by end 2003 or early 2004.

As of end 2002, its PNP stood at P8.1 billion selling a total of 75,980 plans (more than half a million plan holders) since the start of operations in 1989.

If it is any strong indicator, Philam Plans‚ initial first quarter sales grew by a whooping 26 percent.

Based on records, industry sales are far better in the second half of a given year over its first six months performance.

"We have done well, and we are optimistic (to achieve goals) with new sales strategies this year," Jesus G. Hofilena, Philam Plans president and chief executive officer said.

Hofilena said that their conservative forecast for 2003 is a 20-percent growth target in terms of new sales, or roughly P1.6 billion from the P1.3 billion recorded last year. In 2002, gross collections grew by 29 percent versus an estimated 20-percent contraction of the pre-need industry.

Trust funds stood at P6.9 billion by end March this year growing from P6.367 billion by end 2002. Net income in the same period stood at a positive P126 million.

It has total assets worth P26.08 billion in end 2002 while it was ranked 202th among the top 1,000 Philippine corporations in 2001.

Hofilena said that they have strengthened their 22,000 sales force and nearly 70 branches nationwide. Adding to their internal strengths, is the fact that they can tap the resources of its parent company, Philamlife.

This year, it will initiate alliances with third-party marketing groups to increase its network as well as undertake direct marketing activities.

Last year, Philam Plans was ranked first in terms of sales (composite) accounting for roughly 22 percent of the market. In terms of plan category, it ranked first in the pension market category, second overall in the education plan category, and third in the life or memorial category.

Internally, pension plans account for 60 percent of its combined sales followed by education, 35 percent, and five percent for memorial (life).

"For 2003, pension will remain the flagship but there will be major growths for the two other plans relative to its present size," Hofilena pointed out.

In the first two months of 2003, Philam Plans held on to the lead in the pension category accounting for 21-percent market share followed by Prudential Plans with a market share of nearly 12 percent.

In the education category in the same period, Prudential Plans sold 7,849 plans amounting to P761.8 million or 34 percent of the education plans sold in that period. Philam Plans meanwhile was second accounting for 16 percent of the market.

Industry continuous to contract, from a high of over 100 in 2000, it has shrunk to 80 plus at the start of 2001 to 46 by end 2002. This quarter only 40 had submitted their mandatory reports last March.

By end 2002, the top five slots in terms of consolidated sales are contested between Prudential Life, Philam Plans, Pacific Plans Inc., the Comprehensive Annuity Plans (CAP Plans), and Loyola Plans Consolidated Inc.

The top five players in fact accounted for a combined sale of P26.2 billion of the total industry figure of P37.7 billion last year.

"There are no reasons for a change in the top 20 players for the industry," the Philam Plans chief executive said. – TPT