PhilPlans payments expand 27% in 4 months

MANILA, Philippines - PhilPlan First Inc. (PhilPlans) has reported a 27-percent increase in first payment (FP) in the first four months of 2012.

PhilPlans is the country’s largest and most profitable pre-need company. It is a subsidiary of STI Investments Inc., which recently acquired AsianLife Financial Assurance Corp. (ALFA), a life insurance company of the Maybank ATR KE Financial group.

Last year, its FPs grew to P257 million, or 37.5 percent higher than the P186.9 million in 2010.

At the end of April this year, 3,438 plans were sold compared to the 3,301 plans sold (PC) in the first four months of 2011. At the start of 2012, it reported over 300,000 planholders.

STI Investments Executive Committee chairman Eusebio H. Tanco said PhilPlans “is doing fantastic, and we will not hesitate to increase its trust funds and capital to ensure its strength and leadership.”

The pre-need company reported a net income of P1.647 billion last year, up 64.7 percent from the P1 billion recorded in 2010.

Also in 2011, leading competitor St. Peters Life Plans reported a net income of P289 million, while SunLife Plans, Manulife Plans and Prudentialife Plans registered net losses.

Compared to the leading life insurance firms in 2010, PhilPlans emerged fifth highest in terms of net income.

The Philippine American Life and General Insurance Co. (Philamlife) reported net earnings worth P4.1 billion followed by Sun Life of Canada with P2.2 billion. The Manufacturers Life Assurance Co. (Manulife) followed closely with a net income of P2.1 billion in 2010, and Insular Life Assurance Co. with P1.8 billion.

Tanco said that management plans to increase its total paid up capital to P1 billion before the end of 2012. It stood at P700 million at end-2011.

By the end of April this year, PhilPlans’ trust fund stood at a combined P40 billion, from P38 billion in 2011.

Each plan category must have a trust fee sufficiently covering its pre-need reserves for maturities or claims. It sells education, pension and life/memorial plans.

Currently, the pre-need company claims to maintain an excess of around P5 billion (unaudited) in its trust fund. That means PhilPlans has more than enough trust funds to pay its obligations both current and future. 

The trust funds are required by law to be placed with trustee banks not affiliated with the pre-need firm.

Data from its annual reports show that the trustee banks are BDO Unibank Inc. (BDO), Deutsche Bank, the Bank of the Philippine Islands (BPI), the Metropolitan Bank & Trust Co. (Metrobank), Union Bank of the Philippines (UnionBank), East West Banking Corp. (EastWest Bank), Maybank ATR KE Financial, and Maybank Philippines Inc.

Tanco said that he would likely merge ALFA with the groups other life insurance firm, Banclife Insurance Co. Inc. (Banclife). The surviving life insurer would then place insurance cover for all plans of PhilPlans.

Meanwhile, PhilPlans has expanded to 11 territories at the start of the year from just seven at the end of 2010.

Regional sales managers rose from 15 in 2010, to 68 start of 2012. “We are appointing 22 more regional sales manager before end June 2012 to bring the total to 90,” Tanco said.

 Likewise, PhilPlans sales force grew to 413 area managers, 1,046 branch managers, and 2,783 sales counselors end April this year. At the start of 2011, the count was 145 area managers, 432 branch managers, and 1,379 sales counselors.

The number of sales offices increased from 50 in 2010 to 52 as of April 2012.

By the end of 2011, PhilPlans paid a total of P3.6 billion in various benefits to its plan holders. Largest were the pension benefits worth P1.4 billion, education benefits worth in the vicinity of P878 million, life plans over P17 million, and other benefits reaching over P1.2 billion.