(NAR) VOL. 29 NO. 3/ JULY - SEPTEMBER 18
a. Dividend declaration;An MBA that chooses to distribute its surplus by “providing benefits in kind and other relevant services” in accordance with Section 408 may opt to procure any type of pre-need plans from any licensed pre-need company.
b. Enhancement of Equity Value;
c. Providing benefits in kind and other relevant services;
d. Capacity building, research and development, upgrading and improving of systems and equipment, and continuing member education.
a. Only MBAs with free and unassigned surplus that is more than the twenty percent (20%) ceiling provided under Section 408 can procure pre-need plans as a member benefit;3. Requirements for Approval of Acquisition. - An MBA, before procuring pre-need plans, must submit the following:
b. Pre-need plans can only be procured using the excess free and unassigned surplus;
c. Pre-need plans must be issued in the name of the MBA.
a. Letter addressed to the Commissioner manifesting its intention to procure pre-need plans as a way to distribute its surplus by providing benefits in kind and other relevant services to its members with the following details:4. Approval by Commission. - Upon receipt of the requirements stated in item (3) of this Circular, this Commission shall approve or disapprove the proposal within fifteen (15) days from receipt of this Commission, after which, the proposal for acquisition of Pre-Need Plans as admitted asset shall be deemed approved. If the proposal is disapproved, the reason for such denial shall be stated.i. Pre-need company selling the pre-need plan;b. Certified true copy of the duly notarized Board Resolution of the MBA authorizing the distribution of the free and unassigned surplus by providing benefits in kind and other relevant services in the form of pre- need plans;
ii. Type of pre-need plan it is intending to procure;
iii. Number of pre-need plan it is intending to procure;
iv. Amount of transaction involved; and,
v. Written undertaking certifying that MBA has a Free and Unassigned Surplus in excess of the twenty percent (20%) ceiling under Section 408 of the Insurance Code.
c. Copy of the latest IC-approved financial statement showing that the MBA
is compliant with the following:i. Solvency;
ii. Risk-based capital ratio;
iii. Guaranty fund; and,
iv. Reserves for basic and operational benefits.
a. Type and Number of pre-need plans procured upon approval by this Commission;6. Surrender and Pre-Termination of Pre-Need Plans by MBAs. - MBAs may surrender and pre-terminate procured pre-need plans subject to the readjustment of the amount of pre-need plans considered as admitted asset. Such readjustment shall use the pre-termination value received by the MBA upon surrender of a pre-need plan as basis in determining the amount of pre-need plans considered as admitted asset during the annual examination/verification conducted by this Commission.
b. Type and number of pre-need plans surrendered/disposed/transferred/ assigned during the year covered by the report with the following details:i. Name and contact details of the transferee/s who received the pre- need plans by way of transfer or assignment, if any; or,c. Type and number of pre-need plans unused as of the date of reporting.
ii. Number of pre-need plans and termination value of surrendered pre-need plans and the reason for such surrender, if any; and,