November 25, 2019
SEC-OGC OPINION NO. 54-19
RE: PRE-NEED PRODUCTS AS SECURITIES
Mr. Jaime B. Dizon
Executive Vice President and COO
PHILPLANS FIRST, INC.
12/F STI Holdings Center
6764 Ayala Ave., Makati City
Dear Sir :
This is in response to your letter dated 22 June 2018 requesting the opinion of the Commission on your following queries:
1) Whether or not, prior to the promulgation of the Pre-Need Code, the SEC considered pre-need plans as securities, and if so, the legal basis for the same;
2) What are the attributes of securities that the SEC considers as important, in order that they fulfill their function as investment vehicles and trustworthy assets (e.g., determinate growth, ease of liquidation and transferability, etc.); and
3) What does the SEC consider as "non-traditional" securities, and whether or not pre-need plans were classified as such.
Specifically, these queries are posed to aid the Insurance Commission in determining whether or not pre-need plans are admissible assets for investment by insurance companies and other potential clients.
As to your first and third queries, we answer in the affirmative.
You have correctly cited in your letter that...
