Spreading the cost – the case for premium finance
By Simon Millar, CEO, Albanwise Insurance Services
The insurance market is showing signs of stabilising after the longest hard market most brokers have ever known. Insurers have started offering zero rate increases on well performing policies which we haven’t seen for years, but properties that have suffered claims are still seeing increases as claims inflation marches apace.
However, we are still in a cost of living crisis, and insurance premiums are an unwelcome if necessary cost, no matter how big or small they are.
One way of mitigating the cost of insurance on your property is by using premium financing to spread the overall cost across a longer period. This allows for better budgeting, and in the case of Residents Management Companies or other corporate structures, it can also improve cashflow and working capital.
Other benefits to consider include:
- -Preserving lines of credit
- -Keeping the cost off the balance sheet
- -No requirement for guarantors or covenants
- -Interest charges and fees are deductible usually against Corporation Tax (please check with your accountant for individual circumstances)
- -An affordable alternative to a credit card payment or loan
Paying by installments is nothing new, after all many of us probably use it for other forms of personal insurance or finance. However, it is not appropriate in all circumstances, and premium finance providers will look carefully at individual applications.
To discuss whether it might be right for you, or to obtain an indication using our preferential rates with Close Brothers Premium Finance, please speak to your usual Albanwise Insurance Services contact.
Albanwise Insurance Services is proud to have a knowledgeable team with years of experience. Should you have any queries, contact us here.
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