The state of the economy has many people worried about the safety of their savings, including the funds they have set aside in pre-need trust accounts. To keep you informed and assist you in reassuring the families you serve about the safety of the funds invested in the PrePlan Trust Fund, we are providing the following information. If you have any questions regarding this important issue, please do not hesitate to call Colleen Connelly, Director of PreNeed Trust Services, at 1-800-577-3752.
• The PrePlan Trust ONLY invests in Certificates of Deposit, and only with institutions whose deposits are fully insured by the FDIC. FDIC deposit insurance is backed by the full faith and credit of the United States government. Since the start of FDIC insurance in 1934, no depositor has lost a single cent of insured funds as a result of a bank failure.
• PrePlan Trustees discuss investments once per month with the investing firm, Johnson Illington.
• During these discussions, the following information is considered prior to making an investment:
1) IDC rating on each financial institution (IDC rating measures the health of a financial institution based on an evaluation of its asset quality, liquidity, management, earnings, etc.);
2) Percentage of total trust investments with each financial institution;
3) Current Certificate of Deposit yield at each financial institution.
• PrePlan invests in certificates of deposit with approximately 25 different banks throughout the United States for purposes of diversification.
• Each Certificate is titled such that all individual consumers are insured up to $250,000* of their percentage of the particular CD(s). This was the case with the recent failure of IndyMac, where PrePlan had invested in four $5 million Certificates. The papers were filed with the FDIC immediately upon the news of the failure. The full $20 million, along with accrued interest, was received at the PrePlan office within ten days.
• M&T Bank in Buffalo, NY is PrePlan’s depository and acts as custodian for the Trust’s Certificates of Deposit.
