In 2016, Standard functionality should be a given in any Premium Finance Software. Features like regulatory compliance, loan origination, and automation of day-to-day administrative functions should be assumed. That being said, here are some key factors that require further consideration when evaluating a Premium Finance Software:
Agent “User Experience” (UX) – Your Agents will form the frontline of your business. They will very likely be responsible for the premium finance contract origination process. What type of an experience does your premium finance software provide for them? Is it intuitive to learn? Simple to use? Does it provide the flexibility to allow for variations in the repayment (within the boundaries established by you?) If the Agents are not happy with the “user experience,” they are not going to use it.
Customer (Relationship) Experience (CX) – One of the reasons many agencies launch their own financing program is to ensure better relationship management and client retention. A key aspect of relationship management is being able to provide personalized services. In the premium financing business, this maps to functions such as the ability to suspend late notices and/or delay policy cancellations in certain circumstances. A good premium finance software should provide notification and alerts of upcoming accounts that are scheduled to go into late or cancellation status.
Simplicity of Contract Management – Requests for policy changes, such as increases in premiums and reductions in premiums are a common part of the insurance industry. It’s important to assess how the premium finance software handles these requests. Does the software have the capability to recalculate the monthly installment? Is a letter automatically generated with the revised payment details? Will updated Statements be generated? These are some important functions that a good premium finance software platform should provide.
Similarly, the software should be able to compute and automatically adjust the finance charge (in accordance with regulations) when there is a change to the policy premium, or in the event of a mid-term payoff of the premium finance loan. The software should withstand the examination of the State in the event of a State Audit by an examiner. If this sounds ominous, it’s not. In the context of today’s technological advancements, this is as straightforward as carrying out a Google search for “sound software.”
Other Functionality – Among other key functions to look for in a premium finance software, is the ability to automatically handle client refunds. Client refunds occur across multiple scenarios – overpayment on an installment and/or cancellation of a policy resulting in a client refund, etc. Many States have regulations on minimum thresholds for refunds and the software should be able to account for these regulations without need for user intervention.
Needless to say, specialized software is a necessary component of managing a book of premium finance loans— It cannot be done using general loan management software. Luckily, with today’s technological capabilities, this specialized software is available and affordable. The key is to make sure you plan for growth and select a solution that meets your current and future needs.