loan briefing presentation - 10-03-07

LOAN BRIEFING

For F I C C O members

The FICCO “Culture”

Chapter I

The FICCO Culture

What is the culture of FICCO? What makes it different from the

culture of the mainstream cooperatives?

What makes FICCO unique?

The FICCO Culture

Applied to institutions, culture is defined as “the set of shared attitudes, values, goals and practices that characterizes an institution.”

This set of values has gradually seeped into almost all aspects of FICCO’s operations and has shaped its character, which in turn defined its image and public perception.

The FICCO Culture

This culture is actually anchored on the following values and practices: Stewardship and Ownership Transparency, accountability and

Democracy Common Good Recognition of Rights and

Responsibilities Service with Personal Touch

The FICCO Culture

Active Participation of Grateful Members

Quality Service Volunteerism, not opportunism Lean Organization Control cost and expenses High returns to members Aggressive, yet sure-footed

Sources of Funds & Types of Deposits

Chapter II

Sources of Funds & Types of Deposits

Internal Sources:Share Capital

Minimum – P 3,000.00 or 30 sharesMaximum – 20% of Ficco’s total

assetsEarns dividend @ 9% - 12% P.A.Can be used as leverage to loansCan not be partially withdrawn

Sources of Funds

Savings Deposits: A. Regular Savings

Interest @ 4.50% p.a. subject to the following: 1% savings protection plan*** 20% withholding tax

Minimum – average daily deposit of 500.00 pesos

Can be Withdrawn anytime during office hours if not encumbered to loan

Can be used as leverage to a loan

Sources of Funds

Savings Deposits: Special Deposits:

Interest @ 4.50% subject to 20% withholding tax Can be withdrawn anytime during office hours

Youth Savers Club For children ages 0 to 13 yrs old Interest @ 4.75% subject to 20% withholding tax Minimum initial deposit is P 50.00 Membership Fee of P 30.00 Can be withdrawn anytime during office hours The depositor will be given a gift item upon signing in

and gift items will also be given every deposit of 30 times.

Sources of Funds

Time Deposits Subject to 20% withholding tax May be used to secure loans Pre-termination interest rate shall be based on prevailing

savings rate

Amount Bracket Term Interest Rates

1,000.00 to 50,000

30 to 31 days 4.50% per annum

50,001 to 100,000

-do- 4.75% per annum

100,001 to 300 T -do- 5.00% per annum

300,001 to 500T -do- 5.50% per annum

500,001 & Above -do- 6.00% per annum

Sources of Funds

Installment Savings Interest rate – 8% per annum Term ranges - 12 to 48 months May be used as collateral to loans of up to

95% of actual deposits excluding the interest.

Retirement savings Interest rate – 8% per annum Term ranges – 5 to 20 years May be used as collateral to loans of up to

95% of actual deposits excluding the interest.

Loan Services

Chapter III

Who will qualify for a loan?

Ficco members who have :1. Attended and completed the prescribed ½

day Pre-membership Seminar (PMS)2. Deposited at least 3,000.00 pesos (30

shares) in his share capital.3. Maintained a monthly deposit balance of at

least 500.00 pesos4. Completed the 4-month probationary period5. The capacity to enter into a contract.6. Gainfully employed or have a visible source

of income from a business not contrary to Ficco’s principles & philosophies.

How much loan can one member avail?

The amount of loan that a member may avail from Ficco is based on the following:

1. The amount of share capital & savings deposit he has accumulated with the cooperative

2. His classification as a member3. His Character & Capacity to pay4. His willingness to promote Ficco ideals by

actively recruiting other people to be members and remind lost & members.

5. And his participation in Ficco activities, such as the General or Special Assemblies

Membership Classification

Basis of classification:

1. Monthly depositor 2. Pays loans on the agreed due date &

the agreed amortization3. Character & Capacity to pay 4. Attendance during General or Special

Assemblies


CLASS “A1” : Members who have established good

loan track record for at least one year; Pay loans on or before due date; Monthly depositor; With at least 10% increase or P5,000 in

Share &/or Savings deposits whichever is lower;

Has attended the last 2 general assemblies.


Class A1

For Regular LoanIf s/a is =>60% of Enc. Dep. x 350%If s/a is b/n 50-59% of Enc x 325% If s/a is < 50% of Enc. Dep. x 290%

For Seal & HaloIf s/a is =>30% of Enc x 350%If s/a b/n 15-29% of Enc x 325% If s/a is < 14% of encumbered x 290%

Classification Share & Savings multiplier


CLASS “A”: Members who have established good loan track

record for at least one year; Pay loans monthly but avails the 7-day grace

period; Monthly depositor; With at least 10% increase or P5,000 in Share

&/or Savings deposits whichever is lower; Has attended the last 2 general assemblies.

Membership ClassificationClassification Share & Savings multiplier

Class A

For Regular LoanIf savings is >=50 to Enc x 325%If savings b/n 40-49% of Enc x 300% If s/a is less 40% of enc x 275%

For Seal & HaloIf savings is =>30% of Enc x 325%If savings b/n 15-29% of Enc x 300% If s/a is < 14% of encumbered x 275%


Class “B”: Members whose loan record is less than 1 year,

or Pay loans within the month but exceeds the 7-

day grace period; Failed to deposit from one to two months during

the 4-month reckoning period; Has attended the last general assembly. Loan Multiple:

Share x 190% Savings x 200%


Class “C”: Members who failed to pay loans for two

months during the term of the loan; Failed to deposit for two months during

the 4-month reckoning period; Has attended the last general assembly Loan Multiple:

Share x 165% Savings x 185%


Class “D”: Members who failed to pay loans for two

months during the term of the loan; Failed to deposit for two months during

the 4-month reckoning period; Failed to attended the last general

assembly Loan Multiple:

Share and savings x 150%


Class “E”:Members who failed to pay loans

for three months or more during the term of the loan;

Failed to deposit for one or more months during the four-month reckoning period.

Loan Multiple: Share & savings x 100%

Interest on loan rates & Service Fees

Applicable to Major Loan types with monthly amortization Interest on loans shall be paid together with the monthly amortization of the loan.

Loan Term Interest Service Fees

Less than 1 year 9% p.a. 1.00% for the whole term

12 months 9% p.a. 1.75% for the whole term

13 to 24 months 9.5%p.a. 2.25% for the whole term

25 to 36 months 10% p.a. 2.75% for the whole term

37 to 48 months 10.5%p.a 4.50% for the whole term

49 to 60 months 11% p.a. 5.50% for the whole term

Interest on loan rates & Service Fees

For Regular Agricultural Loan (RAL)

Crop type Term (Maximum) Interest Service Fee

Rice & Corn Production

6 months 7% for 6 months

2.00%

Sugar Cane 15 months 14% p.a. 5.00%

Cassava 12 months 14% p.a. 5.00%

• Payable upon maturity of the loan

Loan Types per membership classification

For class B, C & D - First Time Borrowers (Members applying loans after the 4-month

probationary period).1. Regular Loan – Either Provident or Productive or

Regular Agricultural Loan Maximum of P25,000.00 without collateral. Only

share & savings are encumbered. Maximum amount with chattel + Share & Savings

as collateral is P50,000.00 Maximum amount with real estate + Share &

Savings as collateral is P2 million. Maximum term is 36 months for loans of less

than P50,000.00 and 60 months for loans P50,000.00 or more.

Note: LAD applied within the probationary period are not included in the classification consideration.

For Class B (re-loan)

1. Regular Loan – Either Provident or Productive or Regular Agricultural Loan Maximum of P60,000.00 without collateral. Only

share & savings are encumbered. Maximum amount with chattel + Share & Savings

as collateral is P100,000.00 Maximum amount with real estate + Share &

Savings as collateral is P2 million. Maximum term is 36 months for loans of less than

P50,000.00 and 60 months for loans P50,000.00 or more.

2. Petty Cash Loan3. Rice Loan

For Class A1 and A members:

1. Regular Loans 2. Housing Related Loans3. Business Related loans4. Financing Loans5. Medical Loans6. Travel & Tour Loan

For Class A1 and A members

7. Commodity Loans8. Petty Cash Loan9. Jewelry Loan10.Back to back loans11.Regular Agricultural Loan

(RAL)

OTHER POLICIES

Loan Requirements

Fully accomplished Loan Application Two co-makers** Utility bills (Light, water, telephone, cable

whenever applicable) Proof of source of income/ pay slip/ etc. Residence Certificate – current year For Chattel:

Certificate of ownership/ Affidavit of ownership or O.R. & CR for motor vehicles

For Real Estate Original Title, Tax Clearance, Tax Declaration, Sketch

Plan, Vicinity Map, Certificate of non-tenancy for agri-land, SPA if the loaner is not the owner

Collateral & Loan Security

Personal Properties: Household appliances not more than 2

years and motorcycles not more than 3 years from purchase for loans up to P200T

Motor Vehicles not more than 3 years from original purchase for loans up to P 500T for brand new & P300 T for surplus

Medical and/or Dental equipment, heavy equipment or farm machineries not more than 5 years from purchase for loans up to P 500T

Collateral & Loan Security

Real Estate properties: Residential, Commercial, Industrial or

Agricultural Lots for loans up to P 2 M.

Note:All properties used as collateral must be free from liens & encumbrances.

Collateral & SecurityThe use of PDC as security to a loan maybe allowed provided:

Member does not request to hold or postpone payment of the check more than once in the entire length of the loan

The member’s check has not bounced due to insufficiency of funds.

The member will not redeem the PDC at Ficco & is actually doing transaction with his bank.

The checking/current account of the member is existing for at least 1 year with good tract record in his bank.

Class “B, C & D” members are not allowed to use PDC’S as “collateral” to loans.

Co-Makers

Who will qualify as co-makers? Members who:

Have share capital deposit of at least P3,000.00 and has completed the 4-month probationary period.

Whose accounts are updated and not restructured

Have not signed as co-maker to two (2) other member- borrowers

Note: Class A & A1 members are allowed to sign as co-makers to a maximum of three (3) times while Class B, C, D & E are allowed to sign up to two (2) other borrowers

Co-Makers

Class A1 & A members will require only one co-maker except when these members avail of the following:

Class “A1” – P120,000.00 w/ 2 class “A1” or “A” members as co-makers

Class “A” - P100,000.00 w/ 2 class “A1” or “A” members as co-makers

Class “B”, “C”, “D” & “E” members require 2 co-makers regardless of the amount of loan requested.

“Bundak” Deposits

Any sizable deposit (more than 10% of the member’s existing deposit) made by a member to cover deficiency in his deposit requirement is called a “Bundak” deposit.

Class “B-FTTB”, “C”, “D” & “E” members who will make a “Bundak” deposit will have to wait for one & one-half month or 45 days before he will be allowed to apply for a loan.

Class “A1” & “A”, “B-re loan” are exempted from the “Bundak” deposit rule.

Encumbered Deposits

Deposits used as equity to a loan are called “Encumbered Deposits”

These deposits (either share or savings or both or Time Deposits as well as Retirement or Installment Savings) are not withdrawable** until such time that the loan for which it was used as an equity have been fully paid.

** except for LAD where the encumbered deposits is based on the loan balance

Delinquency

Delinquency

When are loan accounts considered delinquent?

When Loan accounts are paid after the agreed amortization Due Date.

When Loan Payment is lower than the agreed Amortization.

Delinquency

Notices & Demand Letters

No. of missed Payment/s

Type of Notice/Action to be taken

1 month Collection Notice

2 months 1st Demand Letter

3 months Final Demand Letter

4 or more months

Account is Turned over to the Legal Department

Delinquency

If an account becomes delinquent, a 3% fines will be collected based on the monthly amortization until the 3rd month of the delinquency. The 3% fines will be collected based on the entire loan balance starting on the 4th month of the delinquency.

Delinquency

Offsetting of Delinquent Accounts: Why are delinquent accounts offsetted

against the members deposits?1. Offsetting reduces Ficco’s expenses on

the provision for bad debts.2. It also diminishes the member’s

expenses on the penalties.3. It is a last resort in collecting delinquent

accounts.

Delinquency

Offsetting of Delinquent Accounts: When should delinquent accounts be

offsetted against the members deposits?1. Delinquent loans with terms of three (3)

months or less will be offsetted 30 days after maturity.

2. Delinquent loans with terms of more than three (3) months will be offsetted if the arrearages exceeded three (3) monthly amortization for monthly amortized loan & one unpaid amortization for quarterly & semi-annual amortized loans.

Members whose accounts are zeroed out due to offsetting of Past Due Loans & those who were turned over to the legal department but have eventually paid off will only be admitted for re-membership after the approval of the BOD of Ficco based on the recommendation of the Past Due Committee.

Delinquency

Delinquency

Co-makers of delinquent accounts will also be sent notices and demand letters.

In case a member applies for a loan but is a co-maker to a delinquent account or an account already at the hands of the legal counsel but not yet filed in the court, the member will be requested to follow up the payment of the said account and the loan request will be granted, however, if the account has already been filed in court, the member/co-maker will have to pay the entire loan balance including all the charges before the requested loan will be released or if the member/co-maker wishes, the delinquent account will be deducted from the proceeds of his loan.

SPP & LPP

Chapter IV

Savings Protection Plan (SPP) & Loan Protection Plan (LPP)

What are these plans? Savings protection plan (SPP) is a

facility that will help a member’s family financially in case of death or total disability of the member.

Loan protection plan (LPP) is another facility that will help ease the burden of paying a member’s loan in case of his death or total disability.

Savings Protection Plan (SPP) & Loan Protection Plan (LPP)

How do these plan work? In the case of the Savings Protection

Plan or SPP, Ficco will pay the member’s family an amount corresponding to his total share and savings in case of death or total disability based on the following policies, viz:

1. For members accepted before July 1, 2006, SPP is 100% of the members total share & savings but not to exceed 750,000.00 pesos.

2. For members accepted on July 1, 2006 onwards, the SPP is 25% of the total share & savings but not to exceed 750,000.00 pesos.

Loan Protection Plan (LPP)

LPP Bracket

Member’s Age

Premium per 1000 loan

18 to 33 yrs P 0.65

34 to 43 yrs P 1.00

44 to 48 yrs P 1.50

49 to 53 yrs P 2.00

54 to 59 yrs P 2.50

60 & above P 3.00

Loan Protection Plan (LPP)

If a person is more than 15 years as a member of Ficco the Bracket amount for LPP is One Peso per One Thousand Loan (P1.00/1000) regardless of age of the member.

Mutual Aid Fund (MAF)

Chapter V

Mutual Aid Fund (MAF) WHAT IS MUTUAL AID FUND?

It is a fund that provides financial assistance to members in case of hospitalization, disability or death of the enrolled member or his relatives


Membership to this Program is Voluntary!

What are these plans?

1. NON-MATERNAL HOSPITALIZATION PLAN


MATERNAL PLAN


DEATH AID PLAN


TOTAL PERMANENT DISABILITY PLAN

Non-maternal Contribution

Member - P120/year Spouse - 130/year Children - 130/child/year maximum

of 4 children Parents - 180/parent/year

Non-maternal benefit

P 700.00 per day for 5 days in a year

For MAF members and enrolled beneficiaries.

Maternal Contribution

P 250.00/year Optional only to female

members.

Maternal Benefits

For Normal Delivery: Trained hilot – P 1,100.00 Midwife/Nurse 1,250.00 Doctor/Hospital 1,750.00For Caesarian section:

P700.00 per day maximum of 5 days.

Death Aid Contribution

For every death of an enrolled member of the MAF, a bonafide member will contribute:

# of yrs as member contribution

Less than 2 years – P2.50/death 2 – 5 years - 1.50/death Above 5 years - .50/death

Death Benefits

Member - P 35,000.00Beneficiaries -8,000.00

CHAPTER VI

Compulsory membership

Membership to the MBA is compulsory for the following:

New members joining FICCO starting September 1, 2007

Old members who borrow more than twice** their deposit

Payment of membership & premiums

After the PMS, new members who want to join FICCO will be required to pay the following:

1. FICCO membership fee -P 50 2. Initial Share Capital - 1003. Initial Savings Deposit - 1004. MBA membership fee - 1005. 1st month premium - 90

Total P440

Payment of membership & premiums

Upon loan application of more than twice* his deposit, an old member who is a non-MBA member is required to pay the following;

1. Membership fee - P 1002. 6 mos. Premium - 540

Total 640

RULES AND REGULATIONS

BENEFITS

LIFE INSURANCE BENEFITS

LENGTH OF MEMBERSHIPCAUSE OF DEATH OR

TOTAL AND PERMANENT DISABILITY

MEMBERLEGAL

DEPENDENTS

LESS THAN 3 MONTHSDue to Natural Death 2,500.00 None

Due to Accident 20,000.00 5,000.00

3 MONTHS BUT LESS THAN 12 MONTHS

Due to Natural Death 5,000.00 None

Due to Accident 20,000.00 5,0000.00

12 MONTHS OR MOREDue to Natural Death 40,000.00 10,000.00

Due to Accident 80,000.00 10,000.00

BENEFITS

Death or Total and Permanent Disability Benefit Total and permanent disability (TPD)

shall mean disability caused by bodily injury or disease which prevents the member or his/her legal dependents from engaging in any gainful activity; and,

must continue uninterruptedly for at least six (6) months

Death or Total and Permanent Disability Benefit

There are two types of TPD coverage:1. Disability with dismemberment – The loss of arms, or

both legs, of one arm and one leg, or of both eyes, shall be considered total and permanent disability. Loss of both arms and both legs shall mean dismemberment by amputation of the entire hand or foot; with respect to eyes, entire and irrecoverable loss of sight.

2. Disability without dismemberment – If a member or his/her legal dependent becomes sick or meets an accident without dismemberment resulting to complete inability to engage in any gainful employment and becomes bedridden, he/she can be considered as total and permanently disabled if after six (6) months the health condition has not improved as confirmed by a competent doctor.

Accidental Death Benefit

Accident is defined as a loss as a direct result, independently and exclusively of all other causes, of bodily injury effected solely by external, violent and accidental means of which, except in the case of drowning or if internal injury revealed by an autopsy, there is evidence of a visible contusion or wound on the exterior of the body occurring within one hundred eighty (180) days from date of such injury.

Member’s Equity Value

After three (3) full years of continuous membership in FICCO MBA INC, a member shall be entitled to an equity value equivalent to at least FIFTY PER CENTUM (50%) of the total membership dues/contributions collected from him/her. This is payable upon termination of his/her membership from FICCO MBA INC. except upon death or total and permanent disability.

Upon reaching the termination age of seventy, the member shall be entitled to payment of the member’s equity value. For unclaimed member’s equity value after reaching seventy-one, interest shall be credited to the equity value at a rate to be determined by the Board of Trustees but in no case less than 2% p.a. per year.

MEMBERSHIP

Applicants must be at least eighteen (18) years old but not more than sixty (64) years old as of the enrollment date. Only those applicants who can meet all of the requirements stated on the prescribed application form shall be eligible for membership.

Any willful misstatement of age in the application that would render a person eligible for coverage when he/she would otherwise be ineligible shall be sufficient cause for the cancellation of one’s membership in the FICCO MBA INC. at any time such misstatement is known. FICCO MBA INC. will only refund all contributions paid by the disqualified member.

MEMBERSHIP

The right to designate beneficiaries is reserved to every member of FICCO MBA INC., who may, at anytime, designate a new beneficiary or beneficiaries. Such request for change of beneficiaries must be made in writing and signed by the member under oath, then submitted to the FICCO MBA INC. office or designated authorized collection centers.

When a member dies without any designation of beneficiaries, the benefits shall be awarded to the legal heirs based on law.

In case of multiple, overlapping applications for membership only the initial application shall be considered valid. Upon discovery of multiple overlapping memberships of one person, the additional certificates of membership shall be automatically cancelled and the contributions for these overlapping memberships shall be refunded. In case of multiple claims for a single event by one member, benefits will be paid only once as defined and due under the initial membership

The member’s legal dependents shall be defined as follows:

If a member is married, his/her legal dependents are:

legal spouse three (3) single and biological and/or

legally adopted children, TWO weeks old but not more than 21 years old

three (3) biological children over 21 years old, single, who are disabled and incapacitated to work.

member’s legal dependents:

If a member is single without biological children, his/her legal dependents are his/her biological parents not more than 60 years old

If a member is single (unmarried) but with children, his/her legal dependents are: three (3) single and biological and/or legally

adopted children, TWO weeks old but not more than 21 years old

three (3) biological children over 21 years old, single, who are disabled and incapacitated to work.

SUICIDE AND OTHER EXCLUSIONS

FICCO MBA INC. will not be liable if the member and/or his/her legal dependent dies by suicide within two (2) years after the effective date or date of last reinstatement of the Certificate of Membership, provided, however, that suicide committed in state of insanity will be compensable regardless of the date of commission.

Where suicide is not compensable, FICCO MBA INC.’s liability shall be limited to the return of all contributions paid.

PRE-EXISTING CONDITION

Pre-existing condition of member: To maintain low contribution rates and to safeguard the funds, FICCO MBA INC. is not liable to any loss (death, total and permanent disability) occurring during the first year of membership or within six (6) months from the date of last reinstatement except if caused by accident and/or diseases acquired within that period as certified by competent physician other than TWO THOUSAND FIVE HUNDRED PESOS (PhP2,500) gratuity for loss occurring less than three (3) months from effectivity date of insurance coverage or FIVE THOUSAND PESOS (PhP5,000) gratuity for loss occurring at least three (3) months but less than twelve (12) months from effectivity date of insurance coverage in case of member’s death or total and permanent disability.

PRE-EXISTING CONDITION

Pre-existing condition of legal dependents: To maintain low contribution rates and to safeguard the funds of the FICCO MBA INC., FICCO MBA INC. is not liable to any loss (death, total and permanent disability) occurring during the first year of membership except caused by accident in case of a legal dependent’s death or total and permanent disability.

Pre-existing condition is a condition for which the member received treatment or has consulted a physician for treatment or has been taking medications during the twelve months prior to the effective date of membership or six (6) months from the date of last reinstatement.

VOLUNTARILY RESIGNED MEMBERS RE-APPLYING FOR NEW MEMBERSHIP

Members that have formally resigned their membership and have received their member’s equity and then re-apply for new membership shall be considered as new members.

In such a case the previously accrued membership term and benefits may not be carried over towards credit in the new membership.

Members that have relinquished their membership and then re-apply for new membership shall once again be subject to the pre-existing condition, as well as all of their covered legal dependents.

FEES AND CONTRIBUTIONS

Members shall be charged TWENTY ONE PESOS (PhP21.00) contribution per week for benefits described in Section A. Benefits above.

Members shall be charged ONE HUNDRED PESOS (PhP100.00) as a one-time application fee in order to cover the expenses incurred in processing the application. This fee is not refundable, nor will it be included for purposes of determining the member’s accumulated and refundable contributions.

The fees and contributions may be adjusted by the Board of Trustees as may be necessary to maintain the funds of FICCO MBA INC. at a level adequate to meet its benefit obligations or commitments under the insurance plan. Any change in the contribution or fee is subject to approval by the Insurance Commission.

FEES AND CONTRIBUTIONS

Contributions may be paid by direct remittance to the FICCO MBA INC. Office or designated authorized collection centers either by Postal Money Order or in cash. If paid by Postal Money Order, contributions are considered paid on the date of Postal Money Order and if paid in cash, the date of receipt in the FICCO MBA INC. office or authorized collection center.

Postal Money Order for group remittance of the weekly contributions shall be accompanied with a list of individual remitters. In the absence of said list, the Money Order shall not be considered as contribution payments.

Payments and/or instruments for payment of the weekly contributions made and executed not in accordance with the Rules and Regulations of the FICCO MBA INC. shall not be accepted and if inadvertently accepted shall be considered null and void and will be refunded.

EFFECTIVITY

Membership in FICCO MBA INC. shall take effect immediately upon payment of the first contribution and approval of the application for membership by the Board or the official so delegated by the Board.

A certificate of membership containing the date of effectivity of membership and a summary of benefits and excerpts of the Rules and Regulations of FICCO MBA INC. shall be issued to each and every member upon approval of the application for membership.

GRACE PERIOD

Any member who fails to pay his/her contribution shall be given a grace period of thirty-one (31) days within which to remit the contributions.

In case of death or total and permanent disability of the insured or legal dependent during the grace period, the balance of the contribution in arrears shall automatically be deducted from the benefits payable.

If after the thirty-one (31) day grace period no contribution payments are received by FICCO MBA INC., the membership shall lapse and in the event of death or disability no benefit will accrue to the member or to the beneficiaries of the deceased member other than the member’s equity value.

TERMINATION OF COVERAGE

Upon death or total and permanent disability of the member;

Upon resignation from FICCO MBA INC.;

Upon expiration of the grace period if no payment is received by then;

Upon withdrawal of the equity value on the insurance certificate;

TERMINATION OF COVERAGE

If the member is terminated with cause by FICCO MBA INC.;

Upon reaching the exit/termination age of 70. Dependent’s coverage terminates upon the

termination of the member’s coverage or at age 70 for the legal spouse, if married, or at 60 for the member’s parents, if single, whichever comes earlier. Termination of coverage shall be without prejudice to any claim arising prior to such termination

REINSTATEMENT OF MEMBERSHIP AND COVERAGE

Membership may be reactivated provided the member is in good health and fulfills all of the requirements as stated in the Reinstatement Declaration form. The reinstatement shall take effect upon payment of the required weekly contributions in arrears with interest at the rate of five per cent (5%) per annum.

If the member cannot afford to pay all the contributions in arrears, he/she may pay only one weekly contribution and his/her membership will be reactivated. But the number of days he/she was on leave/resigned will be deducted in computing the effective number of years of his/her membership.

The member is eligible for reinstatement within a period of three (3) years from the date of lapse. After the three year period, the membership is cancelled.

NOTICE AND PROOF OF CLAIM

When a member dies or becomes totally and permanently disabled or upon the death or total and permanent disability of the member’s legal dependents, the member or the beneficiary shall notify the Benefits Review Committee through the Branch Manager to which said member belongs of such death or total and permanent disability, stating the full name and address of the deceased or disabled, the cause of death or total and permanent disability, the date of death or total and permanent disability, the address and full name(s) of the beneficiary/ies. The claim for benefits should be filed within six (6) months after death or total and permanent disability with any FICCO MBA INC. office.

NOTICE AND PROOF OF CLAIM

The benefits described in Section A. Benefits above shall be paid upon presentation of death or total and permanent disability certificate, sworn statement of the beneficiaries establishing their lawful status as such, and the special power of attorney executed by the beneficiaries as to who among them shall receive the payment in the event that there is more than one beneficiary.

The Member’s Equity benefit shall be paid upon presentation of the member’s birth certificate to prove that he/she has attained the exit age of 70.

Failure to give notice and proof as required, will not invalidate nor diminish the claim if it is shown not to have been reasonably possible to give such notice or proof and that each was given as soon as was reasonably possible.

ASSIGNMENT

FICCO MBA INC. will not be bound by any certificate of membership unless a copy of the assignment and the written consent of every assignee, or other similarly affected person, if any, are filed at the FICCO MBA INC. Head Office and duly endorsed on the certificate. FICCO MBA INC. assumes no responsibility for the effect, sufficiency or validity of any assignment.

NON-TRANSFERABILITY CLAUSE

The Certificate of Membership is non- transferable.

WAIVER OF ARTICLE 1250 OF THE CIVIL CODE

It is hereby declared and agreed that the provision of Article 1250 of the Civil Code of the Philippines which reads:“In case of extraordinary inflation or deflation of

the currency stipulated should supervene, the value of the currency at the time of establishment of the obligation shall be the basis of payment…”

shall not apply in determining the extent of the liability under the provisions of the certificate of membership.

PENAL PROVISION

Any member of FICCO MBA INC., who through malfeasance, misfeasance, or nonfeasance allows a spurious claim to be paid, including the claimant, will be punished accordingly to whatever penalty the Board of Trustees may so decide and the amount of indemnity paid must be refunded to FICCO MBA INC.

AMENDMENTS TO RULES AND REGULATIONS

Any amendment/s made to this Rules and Regulations is/are subject to approval by the Insurance Commission.

IMPORTANT NOTICE

The Rules and Regulations of FICCO MBA INC. embodies the terms and conditions of the insurance described above. A copy of the Rules and Regulations is kept in the main office of FICCO MBA INC. and is available to the member for inspection during its regular office hours.

The Insurance Commission, with offices in Manila, Cebu and Davao, is the government office in charge of the enforcement of all laws relating to insurance and has supervision over mutual benefit associations. It is ready at all times to render assistance in settling any controversy between a mutual benefit association and a member relating to insurance matters.

loan briefing presentation - 10-03-07

Documents