A respected client of the Agency Consulting Group recently analyzed the impact of direct bill income on the working capital and asset base of their independent agency. They found it difficult to maintain a “healthy” 30 day working capital requirement to satisfy financial institutions because of a conversion of much of its premium base from…
It is almost embarrassing to say, but most insurance agents reckon their success by the balance in their checkbook. They don’t pay attention to those superb Operating Statements (Profit & Loss Statements) produced by their expensive Agency Management Systems and most don’t even print their Balance Sheets because either they don’t recognize the importance of…
The time that your staff spends on collection is much more expensive than the returns. If you establish a procedure that suggests that payment will be made by the agency if the insured does not pay a direct billing, legal precedent exists for an assumption of the same expectation in the future. A warning to…
Do you have a good handle on your accounts receivable for agency-billed business? How do you measure up to industry standards or best practices ranges?
An agency would like to provide additional services to valued clients. One of the suggestions was to provide a drop box for customer payments for both agency and direct bill payments assuming it would be used after hours and on weekends. From an E&O perspective, what are the risks of providing this service? Would a…
An insured’s account renewed in May, but the policies were not delivered until June. The agent believed that late delivery made these policies June items, payable to the insurer by August 15, 45 days following closing of the June account. However, when the insurer didn’t receive payment on the policies by JULY 15, they put…
One of your insurers has initiated a surcharge program for renewals of insureds who have had even a single claim in the past three years. Is this legal? Is it equitable? What do you think? To find out what our faculty think about this, read their heated debate.
An insured makes a payment by personal check on a policy that is scheduled to cancel for nonpayment. The check is received before the cancellation date and the company issues a reinstatement notice. Three weeks later, the insured and agent receive another cancellation notice stating that the policy is cancelled retroactively to the previous cancellation…
An insured received her commercial property renewal and paid it in full. She then received a cancellation notice. According to the insurer, they failed to bill the insured three years ago for a policy and wanted the premium for that term. She refused to pay it so they are cancelling the current policy for nonpayment.…
Our Tennessee association has produced an outstanding new disaster plan that includes information on earthquakes, inland storm systems and flooding, fire conflagrations, transportation and industrial accidents, terrorism, and other types of disasters. IIABA members can now download this plan and adapt it for use in their agencies.
