Third Eye Solutions Launches the "Entrepreneur Edition" of its Premium Finance Software
Toronto, Ontario (PRWEB) May 27, 2015 -- Third Eye Solutions is announcing the official release of the "Entrepreneur Edition" of its Premium Finance Software. By providing a low-cost version of its software tailored to the needs of start-ups, Third Eye Solutions hopes to help banks, insurance agencies, and specialty finance companies enter this profitable market. By making the decision to add premium financing to the suite of services they offer, these companies will join an ever-increasing number of stakeholders that are only beginning to realize the potential this market holds as a channel for business growth. As a leading provider of software and services within this industry, Third Eye Solutions has an innate understanding of the many benefits derived from operating a premium financing business.
First and foremost, premium financing is a uniquely stable source of revenue. Due to an immense market size and a consistent demand for the financing of policy premiums, businesses that offer premium financing are rarely faced with a lack of new customers. This, in combination with the 18% APR permissible in most States, low operating overheads, and a fundamental lack of risk guarantee that premium financing can enhance the bottom line of any business.
For insurance agencies in particular, the benefits of offering premium financing in-house are numerous. The value proposition is similar to that seen in the automobile industry when a company like Ford decides to provide financing options to its clients through Ford Credit. First, Ford gets to keep the significant additional revenue derived from the financing, and secondly, it allows Ford to work closely with its customers to find the right car and the right repayment terms, ultimately expediting the sale. This is similar to the rationale for why an Agency would start its own premium finance subsidiary. In addition to streamlining the sales process, offering premium financing services in-house allows Agencies the flexibility to offer personalized service to its customers, including the ability to find the right coverage / payment plan for each customer, and the ability to retain control of the treatment of late / missed payments. This personalized service, in turn, significantly contributes to customer retention. An added benefit is that it allows Agencies to position themselves broadly as financial service businesses, thus increasing their stature in the industry and making them more attractive to potential partners.
This is not to mention the impact it can have on Agency’s bottom line. The following charts illustrate how much more an Agency can make by financing a policy as opposed to just selling it.
Sale of Insurance Premium Only
Insurance Premium: $10,000.00
Agency Commission %: 15%
Agency Commission Revenue: $1,500.00
Producer Commission (30%): ($450.00)
Other G&A (45%): ($675.00)
Agency Net Profit: $375.00
Profit Percentage: 25.00%
Sale of Insurance Premium Plus Payment Plan
Insurance Premium: $10,000.00
Agency Commission %:15%
Agency Commission Revenue: $1,500.00
Producer Commission (30%): ($450.00)
Other G & A (45%): ($675.00)
Payment Plan Finance Charge: $500.00
Expenses Associated with Payment Plan: ($75.00)
Agency Net Profit: $800.00
Profit Percentage: 53.33%
Through fostering increased awareness of how simple it is to start/run a premium finance business, and through providing the tools to help businesses run these businesses with low overheads, Third Eye Solutions hopes to help many businesses realize the aforementioned benefits in the years to come.
Hershal Pandya, Third Eye Solutions, http://www.thirdeyesolutions.com, +1 9052861411 Ext: 33, [email protected]
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