What You Should Know About Insurance Premium Funding

Insurance premium funding is a flexible finance option that allows for you to spread the cost of your insurance across the year. This is a much more manageable form of repayment for businesses who may rely on regular cash flow or who have an increasing number of financial obligations. 

Why is premium funding preferred?

There are many reasons why a company may choose to get insurance premium funding. These reasons include:

  • Spread out repayments to manage your cash flow
  • Fixed interest rates
  • No more lump sums
  • Combined repayments
  • Flexible funding to suit your requirements
  • Tax deductable interest rates

Repaying a loan in easy instalments makes repayments simpler to manage and can ease the strain on cash flow, which can leave you more money to spend on growing your business, paying off other finances and spreading out your costs evenly.

Once you’ve applied, the company will pay your insurance premium on your behalf on the due date. The premium funding company then charges a flat interest rate on the amount of the premium, which will be fixed for the term of the loan. For certain companies, the interest charged may also be tax deductible as a business expense, but you should discuss this in detail with your accountant.

With flexible repayments, terms can be between 3 and 12 months, which can be a significant help in terms of protecting your working capital. For most clients, where policies are $150k or lower, no financials and no director’s guarantees are required, making it even easier to organise. What’s more, when multiple policies are due around the same time, they can all be bundled into the one monthly repayment. 

Choose a repayment structure that suits you

Insurance is vital for your company and staff’s safety, but the costs don’t have to affect your yearly budget each time it comes around. With regular repayments that can be tailored to your business’s earnings, premium funding may provide you with the stability to grow your business while ensuring your assets are in safe hands.

If you are interested in finding out more about the best funding options for your business, get in touch with Atlas Equipment Finance today. With a wealth of experience in the industry, we are always happy to offer knowledgeable guidance to our clients. Give us a call on 1300 731 131 to find out more.