Premium Finance Canada

Premium Financing Services & Its Risks

Premium finance is not at all a brand new construct. Banks, insurers and third-party finance firms still expertise healthy profits by capitalizing on this remunerative revenue stream. Because the insurance distribution landscape continues to evolve, the long run of the freelance broker hangs within the balance. Redoubled competition, quick access to info, legislative changes and rate will increase area unit probably to send tech-savvy customers comparison searching come back renewal time. Demonstrating the worth of the freelance broker is additional sophisticated.

Selling insurance and serving shoppers could be a labor of affection for booming brokers. Making associate degree in house premium non depository financial institution will create those arduous efforts a minimum of eighty fifth additional profitable. It may also give brokers with an extra tool to service accounts -- specifically, hard-to-place personal lines and enormous business lines accounts.

Sound simple? Not thus quick. Once massive players like AIG pull out of the premium finance arena, there's legitimate cause for added caution. However it's onerous to ignore the chance. If done properly, the many edges a broker offers their shoppers and they outweigh the potential risks. The stress here is on the words "if done properly."

In this spirit, we've summarized the highest half-dozen risks of in-house premium finance and ways that to avert them:

  • Bad Debts

  • Interest Rate Management

  • Client Communication

  • Fixed Annuities