Philippine pre-need companies suffered a sharp contraction in earnings in the first three months of the year, as global market volatility erased the bulk of the industry’s investment returns.

Based on the data released by the Insurance Commission on Wednesday, June 24, net income across the sector plummeted 88 percent to ₱140 million in January to March 2026 from ₱1.17 billion in the same period a year earlier.

The drop due to weaker performance from the industry’s trust funds, which are heavily exposed to broader macroeconomic shifts.

Insurance Commissioner Reynaldo A. Regalado blamed the slump on global economic uncertainty and geopolitical tensions, which have collectively weighed on financial markets and undermined portfolio yields. Rising inflationary pressures and heightened asset price volatility also dragged down net performance during the quarter, the regulator said.

Despite the bottom-line erosion, underlying operational metrics indicate that public demand for pre-need products remains intact. Total premium income grew 12.3 percent to ₱6.53 billion from ₱5.82 billion in the previous year.

Consumer appetite for long-term financial planning drove an 11.9 percent increase in total volume, with the number of plans sold rising to 244,233 from 218,218. Life and memorial plans continued to anchor the market, commanding 99.9 percent of all contracts finalized.

The influx of premium revenue helped shored up the industry’s balance sheet, mitigating the investment losses. Total assets expanded nearly 10 percent year-on-year to ₱179.32 billion, up from ₱163.61 billion. Investments held within corporate trust funds, which represent assets earmarked to settle future benefit claims, accounted for 85.8 percent of that aggregate asset base.

Concurrently, the sector’s total net worth rose 12.2 percent to ₱32.36 billion. This expansion was supported by an 19 percent expansion in retained earnings, which now comprise roughly 78 percent of total capital reserves. On the liability side, total obligations climbed 9.1 percent to ₱147 billion, driven by a 9.3 percent increase in required actuarial reserves.

Regalado said that the steady growth across net worth and sales volumes demonstrates that the industry maintains a solid financial baseline. The capital expansion provides the necessary liquidity cushion to ensure that operational entities can reliably honor their long-term commitments to policyholders, he added. (Derco Rosal)