Coop Structure and Operation
Who runs the coop and how?
Teaser Questions
1. Why are FICCO services priced competitively?
2. Is it safe to deposit your money at FICCO?
Is our Money at FICCO Safe?
• It’s more than its 56 years track record
• It is beyond being the biggest community type coop
in the whole country
• Its diligence in making sure that doubtful accounts
are fully provided is contributory
• More so the fact that, unlike banks, its members are
also the borrowers
• FICCO has a tried and tested way of doing things –
we call it the FICCO culture.
Coop Volunteers Function, Term, etc.
Credit Com.
Audit &
Invntory
Election Com.
Arbitratn
&Conciltn
BOD
Educ Com.
Main Function
Approval/
disapprovl of
loans
Safeguard the
coop assets
Handle election
of officers
Settles intracoop disputes
Policy-making,
representation
Education &
training
Manner of
electing
By branch
By branch
By branch
At-large or
entire org.
No. of members
3 per branch
3 per branch
3 per branch
3 for the entire
org.
9 for the entire
org.
Open but must
train
Term
1 year
1 year
1 year
2 years
2 years
So long as active
Term Limit
4 terms or
4 years
4 terms or
4 years
4 terms or
4 years
2 terms or 4
years
2 terms or 4
years
No limit if active
Appointed by BOD
Two Groups that Work for the Coop
• Elected or Appointed Volunteers
o BOD, CRECOM, AICom, ELECOM, A&Ccom
o Treasurer, Secretary, ELECOM
• Paid (or salaried) Personnel
o CEO, Regional Managers, Branch Managers
o Cashier, Accountant, Loan Officer
o Rank and File
Why are FICCO services priced competitively?
• Because FICCO has a group of people
who performs vital coop functions without
seeking rewards or recognition
• We call these people as the -FICCO
volunteers
• They are FICCO’s competitive advantage
Sources of Funds
• Common Shares
• Preferred Shares
• Deposits
o Savings
o Time
o Retirement savings/Instalment Savings
o Youth/Young savers
SOURCES OF FUNDS
• FIXED /SHARE CAPITAL
– Cannot be withdrawn anytime except when one
voluntarily terminate his membership.
– Minimum P3,000.00
– Maximum 20% of total Capital of FICCO.
– Average dividend is 9% - 12%P.A.
SOURCES OF FUNDS
PREFFERED SHARE:
For Associate Members
Non- voting
1 share = P 100.00
Preferred as to income
The same dividend as Common Share.
SOURCES OF FUNDS
•
SAVINGS DEPOSIT
–
–
–
–
Can be withdrawn anytime as long as it is not
encumbered to the depositor’s loan.
Earns interest of 3.25% per annum+ 1% Deposit
Insurance
Computed quarterly
Can be used as equity to Loan
TIME DEPOSIT
Based on deposit bracket
AMOUNT
P 1,000.00 – 50,000.00
50,001.00 – 100,000.00
100,001.00 – 300,000.00
300,001.00 – 500,000.00
500,001.00 – 999,999.00
RATE
4.25%
4.50%
4.75%
5.25%
5.75%
MINIMUM TERM 30 DAYS
INSTALLMENT / RETIREMENT SAVINGS
(Pension Savings Plan )
INSTALLMENT SAVINGS:
Term
Interest Rate
Example:
-
TERM
TOTAL
CONTRIBUTION
12 mos. (P100)
18 mos.
24 mos.
30 mos.
36 mos.
48 mos.
1,200.00
1,800.00
2,400.00
3,000.00
3,600.00
4,800.00
1 to 4 years
7% P.A.
MATURITY
VALUE
1,260.50
1,934.00
2,638.50
3,375.50
4,146.50
5,795.50
RETIREMENT SAVINGS
Term
Interest Rate
–
1 to 5 years
7% per annum
RS – 205 A
Monthly -
P 200.00
Quarterly Semi-AnnualAnnuallyLump Sum-
595.55
1,177.89
2,304.15
9,706.88
Total
Contribution
P 12,000.00
11,911.00
11,778.90
11,520.75
9,706.00
At the
end of
5yrs
6yrs
7yrs
8yrs
9yrs
10th
Maturity
Value
P 15, 198.00
16,624.00
18,183.00
19,889.00
21,755.00
23,796.00
YOUNG SAVERS
- For children ages 6 to 12 yrs old
-
Initial deposit of P 10
Preferred Share of P 100
Interest bearing deposit is P 200
Interest rate is 4.50% per annum
Compounded quarterly
TEEN AGE SAVINGS DEPOSIT
• Initial deposit is P 100.00 plus P 100
Preferred share
• For 12 to 17 year olds
• Succeeding monthly deposit of
P220.00
• Interest @ 5% per annum
• Term is 4 years
• Maturity Value is P 11,947.67
• Pre-termination interest rate is 2% p.a.
Uses of Funds
• More than 29 types of loans
• Features





Affordable interest rates
Easy access
Flexible terms (1 to 60 months)
Loan protection
Patronage refund
Net Income to be returned to members
Distribution of Net
Surplus
Revenue Int income on loans
1,500,000.00
Service fee
300,000.00
Other income
250,000.00
Gross Revenue
2,050,000.00
Total Expenses
1,050,000.00
Net Surplus
1,000,000.00
Distribution:
General Reserve Fund
Not less than
10%
100,000
Education Fund
Not more than
10%
100,000
Community Dev Fund
Not less than
3%
30,000
Optional Fund
Not more than
7%
70,000
Available for Dividend and Patronage refund
300,000.00
700,000.00
Distribution of Dividend and Patronage Refund
Formulae:
Dividend Rate = Amt appropriated for dividend
∑ of members’ ave share capital
Patronage = Amount approp for patronage ref
refund rate Total interest paid by members
(FICCO’s by-laws allows up to 95% of distributable surplus to be
appropriated for dividend)
FICCO Services
In addition to its Loan services, we have many
more!
The New FICCO Mutual Aid Fund
In compliance with the Joint Memorandum
Circular of the Insurance Commission (IC) –
Cooperative Development Authority (CDA) –
Securities & Exchange Commission (SEC), FICCO
MAF will be insured to FICCO’s co-owned
insurance cooperative, CLIMBS Life & General
Insurance Cooperative.
Schedule of Benefit (Option 1)
Hospital
PREMIUM
Life
Insured
Income Benefit
Insurance
Annual Quarter
for 5 days
Member 35,000
700/day
526
131.50
Spouse
8,000
700/day
349
87.25
Children
(age 121)
8,000
700/day
297
74.25
Parents
8,000
700/day
733
183.25
Premium
is per
insured
person
Schedule of Benefit (Option 2)
Insured
Life
Insurance
Hospital
Income
Benefit
1 to 5th
day
Member
Spouse
Children
(age 1-21)
Parents
PREMIUM
Surgical
Benefit
(max 1 yr)
6th to
35th day
Annual
50,000
855
8,000 P 700 P 500
per
per
P 5,000
8,000 day
day
573
8,000
496
Qtr
Premium
213.75 is per
insured
143.25 person
124
1,045 261.25
TERMS & CONDITIONS
1. All existing FICCO Members and their Dependents as
of December 31, 2011, who are insured under
Mutual Aid Fund (MAF), Hospital Income Benefit
(HIB), or Mutual Benefit Association (MBA) are
eligible to participate without limit of age (except
children who are limited up to 21 years old only, no
age requirement for incapacitated children),
without contestability period and death due to
suicide are payable, provided, they are enrolled on
or before March 31, 2012.
TERMS & CONDITIONS
2. All members and their dependent whose
insurance coverage under MAF, HIB, or MBA
has expired and fail to enroll on or before
March 31, 2012 will be subject to terms &
conditions number 4.
TERMS & CONDITIONS
3. Member’s insurance under Hospital Income
Benefit (HIB) which are not expired, are not
yet required to enroll until the last day of
HIB coverage. Renewal of their insurance
will be under Option 2 and will not be
subject to contestability period, provided,
they are insured within 30 days from the last
day of the previous insurance coverage,
TERMS & CONDITIONS
4. Existing FICCO Members and Dependents as
of March 31, 2012, who are not previously
insured in any of the following: MAF, HIB, or
MBA are eligible and encourage to
participate to this insurance program but
will subject to the following terms and
conditions:
TERMS & CONDITIONS
a) Member with or without loan are free to
choose from any of the two (2) options;
b) Member who will avail a =P=50,000.00 loan
and above will be insured under Option 2;
c) Age must below 69 years old:
TERMS & CONDITIONS
d) Not suffering from any of the following:
Cancer, Epilepsy, HIV/AID and Stroke;
e) Death due to Suicide in not payable within
one (1) year of coverage;
f) Subject to Contestability period of Six (6)
Months:
TERMS & CONDITIONS
• In case of claim due to Pre-Existing sickness
not mention in Item D the Insurance benefit
will be subject to ex-gratia settlement based
on this formula:
Amount of Insurance
-------------------------------180 days
X Number of days insured = Benefit
Ex- Gratia formula
Example for Death Aid:
50,000
----------- ---x 125 days =
P 34,722.22
180 days
Example for Hospitalization Claim:
700/day x 5 days
--------------- x 125 days =
P 2,430.55
180 days
Terms & Conditions (New Members)
5. New and Incoming Members of FICCO after
March 31, 2012 are eligible to participate to
this insurance program but will be subject to
the following terms and conditions:
a) Member with or without loan are free to choose
from any of the two (2) options;
b) Member who will avail a =P=50,000.00 loan and
above will be insured under Option 2;
c) Age must below 63½ years old;
Terms & Conditions (New Members)
d) Not suffering from any of the following: Cancer,
Epilepsy, HIV/AID and Stroke or any terminal illness;
e) Death due to Suicide in not payable within one (1)
year of coverage;
f) Subject to Contestability period of one (1) year and
no benefit will be paid in case of claim due to
concealment of any health condition within one (1)
year from the date of coverage;
TERMS & CONDITIONS
6. Effective date of Insurance coverage of :
a) Insurance coverage of existing FICCO member
and their dependent as of March 31, 2012, shall
be upon submission of application with
authority to deduct for payment of premium
from account of the insured or upon submission
of application and over the counter payment of
premium to any FICCO branch provided duly
receipted;
Effectivity
b) Insurance coverage of New and Incoming
Member of FICCO after March 31, 2012, will
be subject to approval, if no notice after 90
days from the receipt of premium and
application form from CLIMBS, the insurance
policy is considered approved and effected
on the application date.
Upgrading of plans
7. All insured member are allowed to upgrade
their insurance coverage from option one (1)
to option two (2) provided they will fill-up
new application form and will be subject to
approval by CLIMBS.
Double Insurance Coverage
8. In case a member has double insurance
coverage, only one benefit with a higher
coverage will be paid in case of claim. Excess
premium will be applied to renewal of
coverage or refunded upon request in writing
by the insured member.
Applicability
9. Quarterly premium are applicable only for
year 2012 during our transition period.
Premium must be paid on or before the
scheduled due to date to avoid termination
of insurance coverage.
10. Members are required to fill-up and submit
an Application Form
Other Insurance Products
Other Insurance Product Available:
• Individual Life Insurance (Permanent and Endowment Plan)
• Fire Insurance with Allied Perils coverage such as Typhoon,
Flood, Earthquake, Robbery, Burglary and others
• Motor Vehicle Insurance with coverage such as Typhoon,
Flood, Earthquake, Landslide and others
For your Insurance Protection and application
form please see the MAF/MBA In-charge or
any employee
Savings Protection Plan (SPP)
1. Maximum share plus savings to be covered is
P300,000.00
2. Basic contribution of 1% of deposit up to the
age of 70 years and 364 days.
3. On a member’s 71st birthday onward,
reinsurance coverage shall cease. For this
reason, the contribution shall be increased to
2.94 % of deposits covered.
Savings Protection Plan (SPP)
4. “Bundak” deposit will be covered provided it
will not be more than 10 times the average
monthly deposit for six months or the
maximum amount of coverage which ever is
lower.
Savings Protection Plan (SPP)
5. New & incoming member /depositor whose
eligibility age for insurance is 55 to 63 years
old will be subject to benefit settlement
schedule based on years of membership after
one year.
– 5 years or less
– >5 years to 10 years
– >10 years
50%
75%
100%
Savings Protection Plan (SPP)
6. New and incoming member/
depositor whose eligibility age for insurance is
below 55 years old will be subject to ex-gratia
settlement if death due occurs within one year
from date of membership.
Amt of Insured Deposit
------------------------- X # of days of membership = Benefit
365 days
Savings Protection Plan (SPP)
7. Death due to suicide will not be compensable
if it occurs within one (1) year from the
effectivity date of insurance or
reinstatement.
8. All eligible existing and incoming member/
depositor are required to participate in this
plan.
Savings Protection Plan (SPP)
Schedule of Premium
Age
18 to 70
71 and up
Gross
%age Rate
Gross Premium
1%
P 0.83 per 1000 per
month
2.94%
P 2.45 per 1000 per
month
Savings Protection Plan (SPP)
Schedule of Benefits Members Age 18 to 70 years old
BENEFITS
AMOUNT OF INSURANCE (maximum of P 300,000.00)
Life Insurance
Equal to the insured amount**
Total and
Permanent
Disability
Equal to the insured amount **
Comprehensive
Personal Liability
P50,000.00 or 20% of the insured amount based on the
latest month coverage whichever is lower up to
aggregate limit which is the 12 month average insured
amount.
**Subject to policy provision
Savings Protection Plan (SPP)
Schedule of Benefits Members Age 71 years old and above
BENEFITS
Life Insurance
Total and
Permanent
Disability
AMOUNT OF INSURANCE (maximum of
P300,000.00)
Equal to the insured amount (Subject
to Policy Provision)
Equal to the insured amount (Subject
to Policy Provision)
Loan Protection Plan + (LPP+)
Features of the Plan:
• Group Credit Life Insurance(CLI) for eligible
borrower;
• Coverage includes Total and Permanent
Disability(TPDB);
• Additional benefit in case of Accidental Death
and Dismemberment(AD&D)
• Fire Insurance for loan Redemption Benefit (FI)
for the residence of the borrower.
Loan Protection Plan + (LPP+)
Schedule of Premium:
Type of Account
Premium
Single Account
P1.08 per 1000 per month
Joint Account
P1.12 per 1000 per month
Loan Protection Plan + (LPP+)
SCHEDULE OF BENEFITS:
TYPE OF BENEFITS
Credit Life Insurance( CLI)
AMOUNT OF INSURANCE
100% equal to the insured loan amount
Total and Permanent Disability
Benefit(TPDB)
100% equal to the outstanding loan
balance
Accidental Death and Dismemberment
(AD&D )
100% equal to the Credit Life Insurance
Fire Insurance for loan Redemption
Benefit (FI) for the residence
of the borrower.
100% equal to the insured loan subject to
the provision of losses: First 50,000 loss
due to fire will be paid equal to the actual
loss and the excess of 50,000 loss will
subject to provisions of Fire Insurance
Policy and shall not exceed the aggregate
limit.
Loan Protection Plan + (LPP+)
ELIGIBILITY AGE FOR INSURANCE:
AGE
BENEFIT
COVERAGE
MAXIMUM
COVERAGE
PREMIUM
RATES(net)
18-64
exit 65
y.o.
CLI, TPDB, AD&D,
FICA
P 2,500,000
P 0.75 per 1,000 per
month
P 500,000
P 0.75 per 1,000 per
month for the 1st
50,000 loan & P 3.00
per 1,000 per month
for the excess of
50,000.00
65 and
above
CLI, FI
FICCO MBA
(Mutual Benefit Association)
MBA product features
Who are covered?
What are the Benefits?
How much is the Contribution?
Initial Product Offering:
– Death & Disability
Who are Covered?
 Members of FICCO and other accredited groups
 If married;
 Legal spouse
 Up to 3 children, who are two weeks old but not more than 21 years old.
 If Single;
 Biological parents who are less than 60 years old for single
members
Benefits for One Unit
IF MEMBER/ DEPENDENT DIES:
Benefit
(in PhP)
a) w/in 3 months from membership
2,500
b) 3 mos. to 1 year
5,000
c) death under “a” or “b” is accident
d) dependent dies thru accident w/in 1 year of membership
20,000
5,000
e) member dies of natural causes after 1 year
40,000
f) member dies thru accident after 1 year
80,000
g) dependent dies due to natural cause after 1 year
10,000
h) dependent dies thru accident after 1 year
20,000
• Contribution
- P 21 per week, or P 80 per month, or 960 per year.
• Grace Period
– 31 days
– if death is within the grace period unpaid contribution will be
deducted from the benefits.
• Termination of Coverage
–
–
–
–
–
–
Death
Total permanent disability
Resignation or Withdrawal of membership
Termination with cause
Expiration of 31-day grace period
Upon reaching the exit age of 70
• Member’s Equity Value
– Upon termination of membership after three
years (except death or total permanent
disability), 50% of paid contribution will be
refunded.
• Non-transferability Clause
– FICCO MBA membership is nontransferable.
MBA Related Policies
•
•
•
All members joining FICCO starting 01
September 2007 are required to buy at
least one unit of FICCO MBA product.
Members can buy up to a maximum of two
units only.
Membership fee - P 50.00
Hospital Income Benefitt
Hospital Income Benefit
1. Who are covered?
Members who borrow P 50,000 or more.
Those borrowing less, it is optional on
their part.
2. Contribution:
P 665 per year. Deducted from the loan
in the first year. Taken from savings
in subsequent years.
3. Benefit:
Hospital income benefit/day
(maximum of 30 days per policy year,
or P 15,000)
Surgical benefit per year
Life insurance coverage
Accidental death or permanent disability
4. The existing MAF policy re hospitalization shall be observed.
5. The MAF takes care of hospital bills. The HIB takes care of
lost income.
'P
500
5,000
15,000
15,000
Thank you!