Full liquidation of Prudentialife Plans pushed
MANILA, Philippines - About 300,000 plan holders of collapsed pre-need firm Prudentialife Plans Inc. may soon know how much money they are getting back as the Insurance Commission (IC) is set to announce next week the value of the firm's assets if these are sold.
In an ANC interview on Friday, March 8, the industry regulator's spokesperson John Apatan said they are finalizing the computations for the liquidation of the firm's assets and the distribution of the proceeds to the firm's clients who previously bought education, pension and memorial plans.
However, there's no guarantee that plan holders will get the full amount of their contribution, Apatan stressed.
"There's a possibility that plan holders may get the whole amount of their contribution or just a portion of it," he explained.
The maturity profile of the clients' package plans, as well as the availed portions of the investment instrument will be deducted from the money that will be returned to the plan holders, he added.
The liquidation process will include the sale of Prudentialife's stake in companies like La Funeraria Paz, Akean Resorts Corp and Afronsa Philippines, among others.
The Insurance Commission has already pressed to liquidate all of the assets of Prudentiallife, a scenario where plan holders will only get an average of P17,787 each.
Previously, an assigned conservator proposed an enhanced rehabilitation program where plan holders will receive an average of around P34,400 each.
The commission had asked for a better rehabilitation plan that must include infusion of fresh capital to cure the company’s huge financial deficiencies.
The Insurance Commission had given Prudentialife opportunities in 2012 to come up with a rehabiliation plan after the pre-need firm was placed under receivership.
Prudentialife has been experiencing cash flow issues since 2001, but the order of the Securities and Exchange Commission (SEC), which used to regulate the pre-need business before IC, to stop selling new plans in 2009 became the fatal blow. It cut off sources of new cash to pay old claims.
Prudentialife's trust fund for its life, education and pension plans reached P7.39 billion as of November 2012.
A namesake, insurance firm Philippine Prudential Life Insurance Co. Inc, had reiterated that it is not related to the troubled Prudentialife, a pre-need firm. - Rappler.com