THE Insurance Commission (IC) is drafting a new framework that will guide pre-need companies in expanding their operations in micro business.
In a roundtable discussion with reporters on Tuesday, Insurance Commissioner Emmanuel Dooc said the commission is positive about the future of micro businesses under the insurance industry, seeing enough reason to want to expand the operations of pre-need firms.
Pre-need companies sell coverage of future expenses through insurance products such as life, pension, education, and interment plans.
Dooc said the pre-need industry is enthusiastic when it comes to selling a micro version of their regular products but they need a guide for setting up micro pre-need operations.
The commission is meeting with industry members this week. They aim to finalize the framework before the end of the year.
Some of the companies have already submitted products that reflect the industry’s positive response to the idea.
“The task is simpler because we can use the framework for micro insurance as our model and guide,” Dooc said.
“There are only 16 licensed pre-need companies in the country, that is why we would like to open up new markets for them, otherwise this number will further dwindle,” he added.
Of the more than 200 companies offering pre-need plans in the 1990s, only 16 are operating and licensed by the lC as of May 2015, according to IC data.
The commission said this is a good indicator that only the financially stable are engaged in the pre-need business.
There is significant demand for pre-need plans, especially memorial life plans —which remain an attractive investment despite the collapse of other pre-need companies in 2009, the commission added.