Advantages offered by premium financing in a competitive market

Given the stiff competitive scenario in the market, insurance agencies are leaving no stone unturned, when it comes to delivering high standards of clientele services to their members. And, in such a situation, insurance premium financing is one of the most ideal options for the insurance companies to satisfy their clients, apart from maintaining their individual cash flow alongside.

Insurance agencies are always on a lookout for opportunities, which can help in differentiating them when it comes to retaining renewals and boosting their business base, in this ever growing competition and soft market. Insurers, on the other hand, are pressurizing the agencies for delivering varied policies and programs, as far as cash flow and payment options are concerned. Hence, opting for premium financing is one of the most dependable and flexible payment methods for insurance companies.

Companies of Premium funding solutions have been collaborating with agencies and insurers, for quite some time now, when it comes financing various types of commercial and personal insurance policies. As compared to regular banks, premium finance companies charge low rates of interests on their lending, apart from allowing the insurers in using the asset of insurance policy for loan collaterals.

Insurers are allowed by the premium financing company to leverage their assets for other equally important business needs, by using insurance policy as collateral. Insurers need to pay for the insurance as they use the payments which are customized according to their needs. And, with premium payments spreading over regular intervals, insurers are benefited to include these payments in their budgeting process. This, in turn, helps in smoothening the expense allocation and cash flow.

Another major benefit of premium financing is that, it offers additional credit facility sans origination costs and interest rates which are uniform till the existence of the loan. Also, early payoff of the loan does not attract any pre-payment penalty. There are various payment plans offered by premium financing, depending on the type of policy, ranging from 3 to 12 EMIs, inclusive of down payment. Also, payment dates are adjusted by the premium finance companies, making them compatible with the insurer’s cash flow.

Given the economic slowdown, which has resulted in creating a severe cash and credit crunch in the market, financial institutions and banks have started tightening their lending policies. This, in turn, has resulted in individuals and businessmen facing hurdles and difficulties for obtaining even the basic loans. But, the competitive interest rates offered by premium finance companies on all types or commercial and personal loans, loan seekers are experiencing a new lease of life. Also, with premium financing, insurance companies are saved from the troubles of having to keep a track and manage payments of the insurers.

For more info : - premium finance corporation