Prudential Life Plan Insurance Going Bankrupt?

Posted by Maribojoc Bohol on February 9th, 2012 in Business

An article from the PDI seems to suggest that Prudential Life Plan is going bankrupt. But let’s hope it would not end that way. There are thousands upon thousands of clients of Prudential Life Plans that will suffer in case of bankruptcy or closure. We however are wondering why the government has issued an order to Prudential Life to stop payment to its clients. What does it mean? It could mean that this insurance company no longer has any funds to sustain its operations and answer obligations to its members? This is one reason I am always hesitant to accept insurance offers. There is simply no stability and no security of your money. Here’s the breaking news report:

The government has ordered preneed firm Prudentialife Plans to suspend payment on all claims but continue payments for some terminated plans as it awaits action from the Insurance Commission (IC) on its proposal for relief and rehabilitation. Prudentialife failed to keep itself afloat after losing its license and permit to sell new plans in 2009, and now is short of at least P10 billion in funds to cover obligations to some 300,000 clients. At the same time, Philippine Prudential Life Insurance Corp. was quick to clarify that it is not the company that is in financial trouble.

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