The Premium Finance Agreement

(a) Any change of funds or other written agreement by which an insured promises or must pay to a premium financial agency or insurance agent or broker the advanced amount or to be paid under the agreement to a licensed insurer or insurance agent or broker in the event of payment of premiums from an insurance contract, as well as to a legal and limited service charge. Where the premium financing agreement is payable to an insurance agent or broker who is not licensed as a premium financing agency or on the orders of an insurance broker, payments under the agreement must be made to the premium financing agency covered in the agreement, which is part of the agreement on its terms and is then transferred. The term “premium financing agreement” does not include a retail rate credit contract that corresponds to the provisions of paragraph (b) section 11 of section four hundred and thirteen of private property rights. (A) in an agreement or other transaction in which a party, the “insurer,” is required to give financial value to another party, the insured or the “beneficiary,” depending on an accidental event in which the insured or beneficiary has or has a material interest affected by the occurrence of that event. 4. A premium finance company notifies the insurer of its financing no later than the 30th day after the premium financing agreement is received by the premium finance company. A notification under this subsection is effective, whether or not the insured`s insurance number is indicated in the notice of contract. [1969 v.639 No 9; 1971 c.231 No 38; 1983 c.239 no. 3; 2003 v.364 No 148] No person, with the exception of a bank, savings bank or state savings bank or a combination of savings or loan funds, a licensed insurer or a lender licensed under Section 9 of this chapter, may operate the activities of a premium financial agency without a licence obtained by the Superintendent, as stipulated in this section. Financing insurance premiums offers a number of benefits. These include the fact that interest against money lent for premium payments is linked to an index, usually to the London Interbank Offered Rate (LIBOR) or Prime, when interest rates rise, the total interest fee will also increase. If the policyholder cannot afford to pay interest, they lose their insurance and have significant debts if the value of the policy rebate is less than the balance owed. If this were the case, the client would not have been able to pay the premiums of an unfunded policy, as with everything else, make sure you could pay the policy.

Responsible lenders take this risk into account when taking charge of the financial. Typical borrowing rates are coupled with 1 year LIBOR with a competitive spread of 180 bits/s. Most borrowing rates are expected to be 2.5% to 6%; 1-year LIBOR fluctuation – the fixed spread. 2. Obtaining a premium financing contract from an insurance broker that is not licensed as a premium financing agency, for a fee directly or indirectly borne by the insured, is considered to be “another service related to an insurance contract”/”other service on the basis of insurance policies or contracts,” as used in N.Y.

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