Planholders of the closed Prudentialife Plans Inc. (PPI) have until March 7, 2018 to file their claims from the liquidation proceeds of the company.
It can be recalled that Prudentialife Plans has been having consecutive years of bad financial performance. Somewhere in September of 2008, the company's assets were not sufficient to cover the requirements set by the Securities and Exchange Commission (SEC) relative to the products they were offering. To solve this problem, PPI tried to reduce the interest rate of the products they were selling. However, efforts to solve the problem were still futile causing the SEC to cancel the company's license to sell in 2009.
In the years after 2009, the company saw its liabilities exceeding that of their assets causing a negative 'Net Worth'. In 2010 and 2011, the company had significantly more liabilities in their balance sheet. Even if the company sold all its assets, it will not be sufficient to pay their obligations.
Reasons for failure
Prudentiallife Plans, may be a case of failure to properly address threats in the future, coupled by possible government regulation problems, as well the global economic crisis in 2007 and 2008. Now, only around 20 pre need companies operate in the Philippines from the 200 companies back then.
To prevent these problems from occurring in the future, the government placed all pre need companies under the supervision of the Insurance Commission through R.A. 9829 known as the Pre-Need Code of the Philippines. Prior to 2009, the SEC is the main regulatory body of Pre-Need companies which might not be sufficient to protect the public since all corporations are under the SEC. There must be a special body that will look after the pre-need companies such as the BSP looking after banks.
The Insurance Commission at that time has been quite successful in protecting the public as evidenced by a very low number of insurance companies going bankrupt. In fact, if there is one life insurance company that the insurance commission sees as having a potential financial trouble in the future, it asks a bigger life insurance company to buy the smaller life insurance company while still honoring the obligations of the smaller company. Thus, it would be wise to place the Pre-Need companies still under the umbrella of the Insurance Commision, which lead to the adoption of the Pre-Need Code in 2009.
The Insurance Commission (IC) was forced to place PPI under receivership on September 19, 2012 after efforts to rehabilitate the company failed. The IC then allowed plan holders to claim whatever is left of the company until September 28, 2017. However, since most creditors were not aware of this, the Makati Regional Trial Cout Branch 147 allowed the reopening of the period for creditors and qualified planholders to file their claims until March 7, 2018.
If you have questions on how to claim your prudential life plan benefits, you may request for a financial advise through the FinancePH Hotline at 0905-FINANCE (0905-3462623) or through (02) 750-4946. You may also email Prudential Life Plans at PPICorporateLiquidation@gmail.com.
According to PPI, the claims must be presented in writing and include the following:
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