nope, just helping spread the word...
"David Quitoriano" To: [email protected]
<[EMAIL PROTECTED]> cc: (bcc: Precious L
Sunga/APD/SunLife)
Sent by: Subject: RE: [4c-math94] Why
SUN LIFE Plans is the
[email protected] Pre-need Company to Trust
04/29/05 07:27 PM
Please respond to 4c-math94
Etut, financial life planner ka na?
______________________________________________________
David Q. Quitoriano http://www.trevoca.com
Spread the FIRE now!
http://www.spreadfirefox.com/?q=user/register&r=18155
-----Original Message-----
From: [email protected] [mailto:[EMAIL PROTECTED]
Behalf Of [EMAIL PROTECTED]
Sent: Friday, April 29, 2005 5:58 PM
To: undisclosed-recipients:
Subject: [4c-math94] Why SUN LIFE Plans is the Pre-need Company to Trust
a little advertisement from Sun Life and some basic info on the status of
other pre-need companies in the Phil =)...
Are we also encountering problems like the others?
A: Sun Life Financial Plans, Inc. (SLFPI), the local pre-need firm of Sun
Life Financial, is doing very well. We posted gains in 2004 with P164
Million in ICBI (Initial Cash Brought In). Based on the SEC pre-need
industry date dated 2004, SLFPI ranked 5th in the industry after barely
fours years of operations. We are considered one of the fastest growing
pre-need companies in the country today.
Our trust funds are well managed by our trustee banks. In fact, we have
maintained a disciplined approach to our policy of ensuring that our trust
funds managed by each of our trustee banks are more than adequate ? more
than what is required by the SEC. The minimum trust fund required by the
SEC is 51% of Gross Contract Price or GCP. Sun Life's contribution to trust
fund is, on the average, at 66% of GCP.
SEC required TF Contribution vs Actual Contribution for our more popular 5
pay plans
|-----------+-----------+-----------+-----------+-----------+-----------|
| TF | SEC | Pension | Pension | Educ | Educ |
|Contributio|Requirement| NonPar | Par | NonPar | Par |
| n | | | | | |
|-----------+-----------+-----------+-----------+-----------+-----------|
| Year | | 5-10 | 5-10 | 5-16 | 5-5 |
|-----------+-----------+-----------+-----------+-----------+-----------|
| | | | | | |
|-----------+-----------+-----------+-----------+-----------+-----------|
| 1 | 5.00% | 20.00% | 40.05% | 20.00% | 45.55% |
|-----------+-----------+-----------+-----------+-----------+-----------|
| 2 | 10.00% | 82.20% | 70.05% | 79.15% | 75.55% |
|-----------+-----------+-----------+-----------+-----------+-----------|
| 3 | 80.00% | 82.20% | 70.05% | 79.15% | 75.55% |
|-----------+-----------+-----------+-----------+-----------+-----------|
| 4 | 80.00% | 82.20% | 70.05% | 79.15% | 75.55% |
|-----------+-----------+-----------+-----------+-----------+-----------|
| 5 | 80.00% | 82.20% | 70.05% | 79.15% | 75.55% |
|-----------+-----------+-----------+-----------+-----------+-----------|
|-----------+-----------+-----------+-----------+-----------+-----------|
|Total as % | | | | | |
| of GCP | 51.00% | 69.76% | 64.05% | 67.32% | 69.55% |
|-----------+-----------+-----------+-----------+-----------+-----------|
Please note that during the 1st two years of the pre-need plan, while SEC
requires pre-need companies to contribute only 7.5% of installments
collected, we already put around 50% of installments collected to the Trust
Fund.
As of Dec 2004, our Trust Fund Equity is at Ps 465.0M. This is Ps 40M
higher than our Actuarial Reserve Liability, which stands at P 425.3M.
While SEC requires pre-need companies to fully fund their Trust Fund
against Actuarial Reserve Liability 105 days from the end of each calendar
year, we make it sure that our Trust Funds are enough to cover our
Actuarial Reserve Liability at the end of each month. In fact, as of Mar
2005, our Trust Fund Equity stands at Ps 562.9M ? this is Ps 42M higher
than our Actuarial Reserve Liability of Ps 520M.
We are not encountering any problems. We have never failed to meet our
obligations. We have honored all legitimate claims.
How did the problems of these two companies affect us?
A: The two primary reasons for CAP's and Pacific Plan's inability to
meet their obligations:
- They invested heavily on real estate and stocks.
- Both offered open-ended plans instead of Fixed-value plans. CAP
continued to
offer these plans despite the deregulation of tuition fee increases
in the 90s.
In open-ended plans, a pre-need firm pays the tuition of a beneficiary
regardless of the amount; while in fixed-value, the pre-need firm pays a
fixed amount at the time of maturity.
The perceived failure of these two companies should not be taken as
whole and encompassing. Some companies are more cautious and better
managed. That is why before making a decision to purchase an education or
pension plan, it is important that one checks first the stability and
soundness of the company, its management, its way of doing business.
A:
1) Sun Life Financial in the Philippines, while relatively new in the
pre-need business, holds the distinction of being the first and the oldest
life insurance company in the country having survived 2 world wars and has
continued to serve the Filipinos' financial needs in good times and in bad
times. We have earned the trust, confidence and admiration of generations
of Filipinos.
2) Our product portfolio is limited to fixed benefits plans, as opposed to
traditional educational plans. Traditional (open-ended) plans are those
where you invest a certain amount and the plan would take care of future
expenses, regardless of cost at the time of availment; while Fixed value
plans are those where you invest a certain amount and receive a fixed
value/amount at the time of maturity.
Offering fixed benefits plans means liabilities are known in advance and
are not subject to impact of inflationary pressures or tuition fee
increases. Our pre-need plans are nothing much different on how we sell
the tried-and-tested endowment policies which we have been selling over the
last 110 years.
3) As a multinational company, we are adequately capitalized and we follow
stringent standards not only those applicable to the Philippines. For
instance, we have in place well-structured risk management and financial
stress testing procedures; we conduct annual review of pricing and we put
focus on investment performance.
4) Our Trust Fund investments are purely in treasury notes and we practice
prudence in managing such. We are adept in long-term investment.
We actually ask our Trustee Banks to present to us monthly financial
statements showing how the money is being invested - including the returns.
Trustee banks also presents to us on a quarterly basis Trust Fund
performance with respect to yields (new money and portfolio), durations,
and strategies for the next quarter.
5) We do not practice deferral of acquisition expenses. We recognize
acquisition expenses as these are incurred. It is for this reason we had
capitalized SLFPI at Ps 300M and not the then minimum capitalization
requirement of Ps 70M.
6) We are the first and only pre-need firm to offer participating education
and pension plans., and thus allowing plan holders to share, through
dividends, the surplus earnings of the Company.
... they already have life policies with us?
A: With the rapidly-changing environment, there is a growing demand for
greater protection and security for the future of your loved ones. Do not
put the eggs in one basket. Learn to diversify and check out other
investment options available to you while you are still at it, in order to
enjoy financial freedom to the fullest when the time comes.
Pre-need plans are designed primarily for the education of your children
and for your retirement. Your needs for assistance to defray tuition fee
hikes in the future and your financial requirements for retirement may not
be totally addressed by your life policies.
The value of education will not go down. In fact, the cost of the college
education is 8X the original cost of the plan!) and the money that you have
saved through your life insurance policies may not be enough to cover the
continuously rising tuition fees and other school needs. It is better to
maximize the returns on your investments to get you fully covered.
A: The Securities and Exchange Commission is currently looking at the
financials of all pre-need companies following the recent developments in
the pre-need industry. Let us just await results of the SEC probe.
To further bolster our information blitz, Sun Life Plans' newest print
campaign featuring Reality TV celebrity Paolo Bediones debuts on
Philippine Star this Monday. Paolo speaks about the strength and stability
of our pre-need business.
(Embedded image moved to file: pic24520.jpg)
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