Services
Transaction Services
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Finance Company Licensing Assistance
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Assistance in Obtaining of Financing
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Buying / Selling of Finance Companies
Fraud Prevention and Detection
Fraud is the most critical challenge a premium finance company faces today. See our special section devoted to Fraud Prevention and Detection.
At PremiumFinance.Consulting we can review your current fraud prevention and detection procedures to determine if they are rigorous enough in today's world where financial related fraud is pervasive
Reduction of Bad Debts
Bad Debt expense is one of the largest expenses that most premium finance companies face. Are you writing off more bad debts than you should be?
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Are bad debts analyzed on an Agency/ Carrier/ Line of Business basis?
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Are bad debts categorized and analyzed by cause of the bad debt?
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Do you prepare a Yield by Agent report or Profitability by Agent report on a periodic basis
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What methods are you using to collect remaining account balances?
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Do you cancel accounts on a timely basis; what is your average Days to Cancel per agency?
- Are down payments sufficient for the line of business financed? Are certain Lines of Business (workers comp, flood, fully earned policies ) experiencing higher than average write-off rates?
We can review your Bad Debts / Write-Off procedures to determine the controls /procedures that you can implement to reduce this large expense line item.
Audit Procedures and Exception Reporting
Do you have a comprehensive set of Audit Procedures and Exception Reporting in place to detect situations which require management attention:
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Do you prepare and review a weekly management report that highlights important trends, and focuses on key business indicators
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Is an Account Exception report prepared on a daily or weekly basis that highlights accounts exceeding pre-set criteria - eg. accounts greater than 10 days past due with no Intent to Cancel issued?
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Do you run independent queries of your account database to ensure that all accounts are classified appropriately?
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Are queries run on a periodic basis to ensure that all accounts are receiving the proper notifications on a timely basis?
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Are exception reports prepared to highlight contracts that exceed certain levels?
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Are addresses scrubbed to detect any improper insured contact information
Best Practices
Premium Finance is a complex industry. There are many important procedures and processes that need to be in place. We can review your procedures to ensure that they are sufficient to meet the needs of your organization:
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appointment requirements for new agents
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underwriting guidelines for new loans including:
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which loan terms are approved automatically on your quoting platform and which require intervention
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are there credit limits set for each agency
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how are certain lines of business controlled
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Loan funding procedures
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how are loans funded and who approves funding
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what Verifications are required prior to funding
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Post Funding Verification - what do you do?
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Cancellation Procedures
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do you review accounts prior to cancellation? What does this entail?
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do you allow account Holds to be placed by agents?
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are accounts cancelled if Payment Holds were placed but not received?
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How do you mail cancellations
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Reinstatements
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How are they initiated - automatically or by agent?
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Payment requirements?
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Profit Maximization and Efficiency
"Make your top line your bottom line"
Meaning: strive for your Bottom Line to be as much of your top line as possible. Don't do business for the sake of doing business. Unless an agent, line of business, business segment is profitable, you probably should not be financing that business.
Is your business as profitable as it should be?
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Rate analysis is critical, are the rates that you charge for a line of business, agency, lower rated carrier, commensurate with the risk?
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Are your rates sufficient on smaller , higher risk policies?
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On what basis do you charge back referral fees on cancelled accounts?
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What is your policy on waiving late charges ?
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Do your profit share arrangements with agents make sense?
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Are marketing reps compensated too much? or too little? compared to their production.
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Are you modifying arrangements with less profitable agents? Or even terminating them?
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Is your payroll expense in line with production?
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Do you print and mail any forms/ notices unnecessarily?
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Does your website provide the agent with the appropriate level of functionality to minimize staff involvement?