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July 14, 2024

Already ordered to undergo rehabilitation, Eternal Plans commits to pay plan holder claims as they fall due

Although Eternal Plans Inc. committed to honor all its obligations to plan holders despite the ongoing rehabilitation, the dispensing of benefits is done on a case-to-case basis and makes for a messy and chaotic process.

But the regulator, the Insurance Commission (IC), on Monday bared the optimism that a claims settlement schedule be in place soon as part of the ongoing rehabilitation of the business started by the late entrepreneur and former Ambassador Antonio L. Cabangon Chua.

Lawyer and IC media relations officer Alwyn Villaruel told Bankero.com.ph that at their last communication with the regulator in January this year, the pre-need firm rejected notions of abandoning its obligations.

“The company told us recently that they commit to still timely service plan holder claims despite the conservatorship. At any rate, the settlement of claims are still on a case-to-case basis, but we expect that claims settlement schedules will be part of the rehabilitation plan that is being crafted right now,” Villaruel said.

The pre-need industry which sells life, pension and educational plans to the consuming public, collectively owns reserves totaling P87.55 billion as at end-December 2021, up slightly more than 11 percent from a year earlier when this totaled only P78.70 billion.

These are funds taken off their premium collection and set aside and invested to underwrite client claims as they fall due.

The Insurance Commission would later determine that Eternal Plan trust funds were not only not in cash as required by regulation but also insufficient to cover claims.