High premium rates and increasing operating expenses have led many companies to look for ways to preserve their cash flow.
One way that businesses can improve cash flow management is to use a premium funding programme for insurance premiums to spread payments over more acceptable cashflow cycles.
Borrowing from a specialist insurance premium financier and repaying the lender in instalments offers significant advantages over a traditional single lump sum premium payment. These include:
Choice & flexibility: You can select from a range of instalment payment plans to best suit your cash flow needs.
Financial benefits: Rates are competitive and fixed throughout the term of the loan and there are no monthly account fees.
"Bundling": Incorporate your other general insurance premiums as well as your ACC premiums into the one instalment programme to achieve greater benefits and value to your business.
Marsh can help tailor a premium funding programme to suit your organisation and create a payment schedule to meet the cash flow cycle of your business. Software has been developed to assist in doing a comparative analysis of the cost of funding against the cash flow of an organisation and its working capital return.
A specialist premium financier provides a facility to lend the total of all premiums to the insured by making the payment directly to the insurer or insurance broker. The insured repays the lender through a structured instalment programme. The security for the loan is usually the unexpired portion of the insurance policy.
In the event of default or cancellation, the lender has the right to cancel the funded policies and receive any refund due from the insurer. There is no security held by it over the physical assets of the business.
To find out more about how Marsh can help you, contact our Payment Solutions Team.
