MANILA, Philippines — The Philippine pre-need industry is growing bigger on paper, but its earnings are telling a very different story.
Total assets of pre-need companies climbed to ₱183.301 billion in the first half of 2026, up 8.87% from a year earlier. Yet despite stronger sales, higher premium collections and a growing customer base, the industry’s combined net income plunged 52.89% to ₱2.506 billion from ₱5.321 billion in the same period last year.
The culprit: weaker investment income amid volatile financial markets.
Data from the Insurance Commission (IC), reported by multiple Philippine business news outlets, show that the sector’s profitability was hit even as Filipinos continued to buy pre-need products and companies strengthened their overall financial position.
More Plans Sold, More Premiums Collected—But Less Profit
The numbers reveal a striking contradiction.
Pre-need companies sold 466,834 plans in the first six months of 2026, nearly 10% more than the previous year. The overwhelming majority—466,437 plans—were life plans, while pension and education plans accounted for a much smaller share.
Premium income also rose 11.43% to ₱12.799 billion, signaling continued consumer demand for products designed to provide future benefits or services, including life and memorial plans.
But stronger sales did not translate into stronger profits.
The Insurance Commission attributed the sharp decline in earnings to weaker investment returns, with external developments affecting financial markets and the performance of the industry’s investments.
This pressure had already emerged in the first quarter. The industry’s net income plunged 88.05% to about ₱140 million in the January-to-March period, as global economic uncertainty, geopolitical tensions, market volatility and inflation weighed on investment earnings, according to the regulator and earlier reports.
Trust Fund Investments Remain the Industry’s Biggest Asset
Despite the earnings slump, the industry’s balance sheet continued to expand.
Investments in trust funds—the largest component of pre-need companies’ assets—rose 8.50% to ₱157.980 billion and accounted for 86.19% of total industry assets in the first half.
That distinction is crucial: a drop in investment income does not necessarily mean the industry is shrinking. The latest figures instead show that the sector’s asset base continued to grow, even as returns generated by those investments weakened.
Total net worth also increased 12.84% to ₱35.636 billion, supported by higher capital stock and retained earnings. Meanwhile, total liabilities rose 7.96% to ₱147.664 billion, largely reflecting pre-need reserves and obligations to plan holders.
A Resilient Industry Faces a Tougher Market
The first-half results extend a dramatic shift from the industry’s strong performance in 2025, when pre-need companies reported net income of about ₱7.96 billion, up more than 54% from the previous year. Assets also reached approximately ₱178.2 billion by the end of 2025.
Now, the industry faces a more challenging investment environment.
The broader Philippine economy itself grew just 2.3% year-on-year in the second quarter of 2026, underscoring the more cautious economic backdrop during the period.
Still, the Insurance Commission has maintained that the industry’s expanding assets, net worth and continuing growth in plan sales indicate that the sector remains financially positioned to meet its obligations to plan holders.
The Bottom Line
For now, the Philippine pre-need industry’s biggest challenge appears to be profitability, not growth.
Assets are rising. More plans are being sold. Premium collections are increasing.
But the sharp fall in investment income is a reminder that even a growing financial industry is vulnerable to what happens beyond its sales offices—inside the markets where billions of pesos are invested.
The question now is whether stronger consumer demand can continue to offset weaker investment returns—or whether the industry’s profit squeeze will deepen in the months ahead.
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