1. What makes a pre-need plan a better investment?

First, you get more than other investments.

If you go to bank and deposit, it will earn between 1 to 3%. If you put a larger amount then maybe the bank will give you a higher interest rate. But this will not be fixed over the life of the investment. With pre-need, your investment will earn from 6 to 7% and these higher earnings are guaranteed over the life of your investment.

Secondly, you don't have to die to get the protection offered by other investment although in case there is premature death, you will get the same protection as though you are insured.

2. How is my investment protected from possible company bankruptcy or other financial problem?

The investment is deposited into a trust fund and managed by an independent, competent and credible trustee bank. The trust can only be withdrawn to pay maturing investments.

3. What are the different pre-need plans in the market?

There are three basic types of pre-need plans: PENSION, EDUCATION, and LIFE-PLAN.

Pension Plan prepares you for your retirement years, where you can fully enjoy financial independence and self-reliance the way you want to spend your savings in your old age.

Education Plan lets you invest for the education of your children in the future. This comes two (2) types:

a. Traditional - covers the entire cost of your child's tuition fees.

b. Fixed Value - specifies certain amount allotted for the child's educational fees.

Life Plan Prepares your family in case the planholder passes away. This comes in two (2) types:

a. Open-Ended Life Plan - Considered a hedge against inflation as it guarantees memorial services regardless of cost.

b. Fixed Value Plan - Assures payment of money's fixed amount to care of the planholders memorial services.

4. Is it safe to pay my dues through an agent or I should personally transact payments with the company?

You can do both. It is safe to through an agent as long as you are issued an official receipt.

For plans not paid on time, you are given sixty days (60) grace period to settle your account. If the sixty days (60) grace period has lapsed, your account will be considered a lapsed plan. When your plan lapses and anything happen to the planholder, the beneficiary will not receive anything. The planhoder is given two years (2) to reinstate his plan by means of updating or redating.

Updating is paying all amounts due plus accured on the plan. The maturity date of the plan will still be the same. By re-dating, you will only pay the amount due to plus interest on the plan. The maturity date of the plan will still be the same. By re-dating, you will only pay the amount that corresponds to the installment due but the maturity date will be extended.

6. What if something happens to my child or he decides to drop out of school before saving of the entire education plan, what happens to the plan?

For fixed value plans, the planholder can still get the remaining educational and post availment benefits.

For traditional plans, the remaining unpaid benefits can be converted into cash.

7. Will my child still be able to avail of his education plan even if I was unable to complete the payment due to permanent disability or death?

Yes, the plan is considered fully paid in case the planholder dies even before completing payment; he can still avail of the benefits.

8. Who will avail of my benefits in the event of my early death and I had no beneficiaries listed in my plan?

Benefits will go to the planholders estate. However, most companies require a beneficiary.