The Insurance Commission (IC) has placed Eternal Plans Inc. of the late Ambassador Antonio Cabangon Chuna under conservatorship for its failure to comply with its directive to fill the cash deficiency in its 2018 Trust Fund as required under the Pre-Need Code of the Philippines.
IC Commissioner Dennis Funa signed the conservatorship order against EPI on January 20, citing as reason the company’s “continuing inability or unwillingness to comply with the Order of the Commission pursuant to Section 49 of Republic Act 9829) of the Pre-Need Code.
John Apatan, the division manager of the IC’s Conservatorship, Receivership and Liquidation Division, was named ex-officio conservator for the EPI.
Under the law, a conservator may be appointed to take charge of the assets, liabilities, and the management of such company, collect all moneys and debts due the company and exercise all powers necessary to preserve the assets of the company, reorganize its management, and restore its viability.
In his memorandum to Finance Secretary Carlos Dominguez III, Funa said EPI had asked for regulatory reprieve with an additional request to undergo rehabilitation after failing to meet the IC’s deadline to make a cash infusion sufficient to fill its trust fund deficiency.
“We find this request consistent with the regime of conservatorship. Hence, the case of the company falls under the conservatorship process under the Insurance Code,” Funa said.
Funa pointed out that the commission never received any correspondence or submission EPI and the “required Trust Fund deficiency remains deficient.”
The IC directive was for EPI to infuse cash into its Trust Fund within five days from the receipt of the IC’s letter dated November 18, 2021.
After the EPI asked for an extension, the IC gave it until December 28, 2021 to comply with the order.
In a letter dated December 22, 2021, the IC reiterated that EPI’s previous non-cash contributions were provisionally approved with the condition to sell the same within one year, or to replace the same with cash if the said assets remain unsold after the given period.
Funa said the IC also made it clear to EPI that non-cash contributions cannot be accepted as the Pre-Need Code requires that deposits to the trust fund should always refer to cash.